Retail like-for-like sales fell 1.8% in February and fashion sales recorded their worst performance since last April as the end of the Sales and bad weather hit trade.
The British Retail Consortium (BRC) said that last month’s sales boost was a “discount driven blip”. Total retail sales values in February rose only 0.1%, according to the BRC-KPMG retail sales monitor.
The BRC said that the men’s and women’s clothing sectors had their worst month since April last year, with the usually more resilient kidswear market showing only minimal growth. The cold weather helped sales of knitwear, fleeces and warm accessories. Casualwear sold better than formal product, and sales of designer ranges held up for some retailers. Sales of handbags, jewellery and hair accessories continued to grow.
“The short burst of spending unleashed by January clearances has largely vanished, replaced by sales as weak as most of last year. “
BRC director general Stephen Robertson
Men’s footwear showed a small gain but women’s footwear was still down on a year ago, with further markdowns needed to clear stocks and a slow start to new season ranges in the wintry weather.
Internet and home shopping sales in February were up 12.3% year on year. However this was a slowdown against the 30% increase in December.
For the three months from December to February, non-food sales were down 5.3% on a like-for-like basis, and down 3.2% in total.
BRC director general Stephen Robertson said the figures were disappointing. He said: “It’s now clear we were right to fear January’s surprise year-on-year sales rise was just a discount-driven blip. The short burst of spending unleashed by January clearances has largely vanished, replaced by sales as weak as most of last year. Food sales are proving more resilient but every non-food sector, apart from children’s clothes, saw like-for-like sales down on a year ago.”
KPMG’s head of retail Helen Dickinson warned that rising costs for retailers would mean more job losses in the sector.
Dickinson said: “The women’s and men’s clothing sectors had their worst month since April 2008, being impacted significantly by the snowy weather in the first week of the month.”
“Although activity picked up later on, it dropped off again in the last week of the month following further headlines about the worsening economic outlook. Battling falling sales - total, as well as like-for-like - is not a sustainable prospect for many retailers in the non-food sectors, particularly as the impact of rising import costs is also filtering through to their margins. More announcements of job losses and other cost cutting measures in the sector look likely in the short term.”
The BRC repeated its call to freeze planned increases in business rates.
Robertson said: “Early February snow didn’t help but customers and retailers’ difficulties run deeper. Meanwhile government stands by. We’re not looking for handouts but, from business rates increases to a supermarket ombudsman, we don’t need costly new handicaps.”