UK retailers foresee disappointing festive period: CBI survey

Despite a slight uptick in sentiment, firms expect sales to decline again in December. Retailers also reported a reduction in headcount in the year to November, while investment is set to decline in the year ahead. Price pressures in the sector are expected to remain acute.

Retail sales volumes fell by 11 per cent in the year to November compared to a fall of 36 per cent in the year to October.

Sentiment amongst retailers recovered somewhat in November, with firms expecting their business situation to improve slightly over the next three months.

Retailers expect to reduce investment in the next 12 months compared to the past 12, but to a lesser extent than in August.

Retailers reported a milder reduction in headcount in the year to November compared to the previous quarter. Employment in the retail sector is expected to be broadly unchanged in December, CBI said ina  release.

Retail selling prices continued to rise at a rapid pace of 73 per cent in the year to November, and are expected to maintain a similar rate of growth in December.

Retailers cut back on orders placed upon suppliers in the year to November, but to a lesser degree than in the previous month. Orders are expected to decline at a marginally faster pace of 26 per cent next month.

UK retailers reported that stock positions were still ‘too high’ despite softening in November, while stock volumes look set to remain similarly elevated relative to expected sales next month.

Internet sales volumes continued to fall rapidly (minus 39 per cent) in the year to November, though the contraction has moderated compared with last month’s record rate of decline (minus 78 per cent). Online sales are expected to fall at a broadly similar pace of 42 per cent again next month.

Fibre2Fashion News Desk (DS)