Retailers report downturn in trade

Shoppers out in force. File picture
Shoppers out in force. File picture

by business editor Trevor Sturgess

Spring has not yet sprung for retailers as shop sales slipped in May.

The latest figures - down 0.8 per cent on a like-for-like basis - follow an Easter boost when holidays and sunshine brought shoppers back to the high street.

Even two bank holiday Mondays in May failed to lift retailers' spirits.

According to the British Retail Consortium-KPMG Retail Sales Monitor, food sales slowed, while clothing and footwear fell below strong sales in May 2008. Big-ticket homewares and furniture remained difficult with the squeeze on household budgets, the weakness of the housing market, and fears over unemployment.Non-store sales through the internet, mail-order and telephone, were weaker than previously, up just 7.6 per cent over a year ago.

Stephen Robertson, director general of the British Retail Consortium, said: "Sun and Bank Holidays don’t a recovery make. Warm weather and days off produced some good performances for seasonal clothing and outdoor living products such as gardening goods and summer food and drink. But this May was always going to be difficult because the comparison is with strong May sales last year which delivered some of 2008’s best growth figures.

"The three-month average is up slightly overall but still well down on the rates regularly seen before the slowdown really hit retail a year ago. Negative results show spring has been extremely difficult for most non-food retailers.

"The turnaround in sales of big-ticket items such as furniture and large electricals, which would indicate real change in the mood of customers, still eludes us."Helen Dickinson, head of retail with KPMG, the business advisory group, said: "These figures may look disappointing after last month’s positive results were flattered by the timing of Easter, but extremely challenging market conditions - particularly for the non-food sectors - continue.

"We might have expected better figures as, while there are consumers struggling financially due to actual, or the prospect of, job losses, there are also those with greater disposable income due to lower mortgage payments, easing inflation and lower fuel costs. It remains to be seen when those who have cash to spare will feel confident to start spending again."

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