High street Christmas slump fuelled by Black Friday sales boost
POOR Christmas trading on the high street contributed to the worst December sales performance since 2010, according to the latest government figures.
UK retail sales fell 1.5 per cent month on month, according to the Office for National Statistics, a much heavier decline than economists had forecast. The figures also marked the biggest month-on-month fall since June 2016, when the UK voted to quit the European Union.
The statistics further reveal that annual growth for 2017 fell to 1.9 per cent, far below expectations and the weakest rate recorded since 2013.
A dip in consumer confidence following the Brexit vote and strong Black Friday sales in November has been blamed on the December spending slump.
ONS senior statistician Rhian Murphy said: "Consumers continue to move Christmas purchases earlier with higher spending in November and lower spending in December than seen in previous years. However, the longer-term picture is one of slowing growth, with increased prices squeezing people's spending."
Graeme MacLaughlin, relationship director at Barclays corporate banking in Northern Ireland said the figures were not all doom and gloom.
“Although it might look like a negative result for the retail sector at first glance, December's retail data needs to be considered more carefully," he said.
"The pattern of trading is shifting, with variables including the evolving influence of Black Friday, timing of wider price cuts and importance of online trading disrupting traditional sales patterns. As today's data shows, purchases have been pulled forward to November which has had a knock-on effect on December's figures."
“Northern Ireland retailers look to have performed slightly better than the UK average, possibly caused by a strengthening local economy and the added benefit of cross-border shoppers from ROI taking advantage of the their increased buying power. This has helped balance out the drag on consumer confidence caused by the lack of a functioning Executive at Stormont," Mr MacLaughlin added.
Looking ahead, PwC's UK consumer markets leader, Lisa Hooker said the outlook for retailers "remains tough", with muted consumer demand as real incomes are squeezed.
"Nonetheless, we expect to see both winners and losers in every category of the retail sector. Shoppers will gravitate to brands offering a compelling and differentiated proposition, as well as value for money, which will become increasingly important as purse strings are tightened."