Home / Knowledge / News / Textiles / UK retail performance likely to drop in Q4 2017: Report
UK retail performance likely to drop in Q4 2017: Report
Jan '18
UK retail performance likely to drop in Q4 2017: Report
UK retailers are likely to witness a decline in their business in Q4 2017, bucking the four-year trend of retail health not downturning between the third and fourth quarters, says a report. However, Q3 2017 brought some respite with improving demand in summer contributing to a better performance for retailers, holding off a third consecutive drop this year.

In recent years, demand amongst consumers during Black Friday sales and Christmas has been the primary driver for maintaining the state of retail health in the final quarter. However, this year may be different, according to the latest finding of the KPMG/Ipsos Retail Think Tank (RTT). With Christmas shopping usually propping up fourth quarter's performance, the RTT felt that, this year, the increased pressure on cost and margin, coupled with the full impact of currency hedging unwinding and wage deflation, will result in retail health falling back in the fourth quarter.

"The end of the year would see many retailers entrenched in a cycle of deep discounting in an attempt to drive up demand at the expense of margins. Further damage to margins will be felt by the full effect of currency hedging unwinding – with many retailers locked into poorer dollar currency rates for the remainder of the year," RTT said.

Cost continues to be an issue for retailers across all areas of the sector, with substantial investment taking place to both improve internal productivity, and deliver a true multichannel offering to customers. The expense of fulfilment for home deliveries will continue to impact on retailers’ costs and squeezed margins. This is predicted to intensify in the fourth quarter, with RTT expecting online sales to make up a higher percentage of total sales throughout Christmas and Black Friday promotional activity.

"After some welcome respite in the third quarter, this coming quarter looks more challenging.  The state of retail health is in danger of reaching a tipping point not seen since 2012, when the festive ‘shot in the arm’ isn’t enough to counteract the ongoing issues with rising costs and squeezed margins," Dr Tim Denison, head of retail intelligence, Ipsos Retail Performance, said.

"Many retailers saw an improved performance in the third quarter, with cooler than usual autumnal weather boosting the apparel sector, which has had a difficult year to date. Continued macro-economic uncertainty and potential interest rate rises looming on the horizon could dampen consumers’ spending in the run-up to Christmas and therefore, forecasts for the golden quarter are not looking bright. The next few weeks’ trading will determine whether or not 2017 is a success or failure for retailers," said Paul Martin, head of retail at KPMG UK. (RR)

Fibre2Fashion News Desk – India

Must ReadView All

China reportedly cancels trade talks with US, Liu He visit

Apparel/Garments | On 22nd Sep 2018

China reportedly cancels trade talks with US, Liu He visit

Washington is reportedly positive about arriving at a solution to its ...

AmCham Cambodia cautions US against possible sanctions

Apparel/Garments | On 22nd Sep 2018

AmCham Cambodia cautions US against possible sanctions

In a letter to US lawmakers, the American Chamber of Commerce...

Courtesy: ycloset

Apparel/Garments | On 22nd Sep 2018

Alibaba invests in clothes sharing platform Ycloset

Chinese garment sharing platform YCloset has completed an undisclosed ...

Interviews View All

Headhonchos, Indian fashion industry

Indian fashion industry

Organic the first choice of any environment-conscious person

Top executives, Textile & apparel bodies

Top executives
Textile & apparel bodies

Textile industry would like to see inclusion of cotton yarn under MEIS and ...

Neel Sawhney, One Friday

Neel Sawhney
One Friday

‘The share of kidswear segment in the online sector is still small in...

Ramez Basmaji,

Ramez Basmaji

Fabusse is a Lebanon-based fashion agency that offers a variety of...

Karan Behal,

Karan Behal

Karan Behal, founder and chief executive of top-selling brand...

Abhishek Pachauri,

Abhishek Pachauri

Reckon Industries adapts latest systems for manufacturing from designing...

Ray Baughman, University of Texas -Dallas

Ray Baughman
University of Texas -Dallas

<div>A team of scientists and researchers have discovered twistrons,...

Dr. Rene Wollert, Freudenberg Nonwovens

Dr. Rene Wollert
Freudenberg Nonwovens

Dr. Rene Wollert discusses the current scenario of the global nonwovens...

Davide Vigano, Sensoria

Davide Vigano

Sensoria is a leading developer of smart garments and IoMe (Internet of...

Mike Hoffman, Gildan Activewear SRL

Mike Hoffman
Gildan Activewear SRL

Gildan Activewear, a manufacturer and marketer of branded clothing and...

Robert Brunner, Devereux

Robert Brunner

Golfwear and menswear brand Devereux is set for greener pastures. Robert...

Ritu Kumar, Label Ritu Kumar

Ritu Kumar
Label Ritu Kumar

‘Classics will return’ "There are a lot of people wearing western clothes ...

Press Release

Press Release

Letter to Editor

Letter to Editor

RSS Feed

RSS Feed

Submit your press release on


Letter To Editor

(Max. 8000 char.)

Search Companies


Leave your Comments

September 2018

Subscribe today and get the latest update on Textiles, Fashion, Apparel and so on.

news category

Related Categories:

Advanced Search