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Womenswear retail sales slightly better in June
Aug '08
UK retail sales values fell 0.9% on a like-for-like basis, compared with July 2007, when they had risen only 1.2%, hit by very wet weather. Sales have now been lower than a year ago in four of the past five months, the worst since summer 2005.

Changeable weather hit sales in July. A few sunny days together with extended clearance events helped some but underlying trade remained tough, with widespread discounting.

Clothing and footwear fell further below the year-earlier level. Furniture and homewares remained well down on a year ago, despite continued discounts and promotions.

Consumer confidence has weakened still further to new record lows. With increasing demands on household budgets, shoppers are very price-conscious and reluctant to spend on big-ticket items. Even heavy discounting often failed to tempt customers to buy.

Stephen Robertson, Director General, British Retail Consortium, said:
“Four of the last five months have now seen negative like-for-like annual sales growth and in July every sector except food recorded falls. Frivolous shopping is off the agenda as most customers concentrate on value and durability and there are few signs the slowdown has yet bottomed out. This is a good time for consumers to take advantage of the wide range of discounts and promotions available to them.”

Helen Dickinson, Head of Retail, KPMG, said:
“July saw a continuation of June's trend, with food inflation and the wider economic climate continuing to impact consumer retail spending. As July 2007 was one of the worst performing months of last year, total sales growth of just 1.7% in July 2008 highlights how disappointing a month it was for all retail businesses.

Although total retail sales and food sales grew compared to the same period last year, the non-food sector contracted for the second month in a row. The furniture and home-related sectors continue to bear the brunt of falling consumer confidence and increasing demands on household budgets. Women's footwear was the only highlight in the clothing and related sectors, perhaps suggesting a need for a personal treat in the midst of all the gloom.”

Sales fell further below their year-earlier level after the sun-driven growth in May. With shoppers increasingly cautious in spending tight budgets – and now often seeing clothing as more of a discretionary purchase – core basics, childrenswear and clearance bargains sold well. Upmarket designerwear also maintained its strength for some, but mid-market ranges remained more difficult. As in June, womenswear was slightly stronger than menswear.

Despite extended heavy discounting, sales worsened further, to just below their July 2007 level. Women's held up better than men's and children's but was largely discount-driven. Sandals sold well on sunny days. On wetter days, there was some early interest in new autumn/winter ranges, particularlysmart black shoes for work. The squeeze on discretionary spending continued to favour value ranges, though premium designer ranges still gave gains for some.

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