Retail sales plummet in early January
High–street sales fell for the tenth month in a row in January 2009 and are expected to decline further in February, according to the Confederation of British Industry (CBI).
Their research found that 63% of retailers reported a drop in sales in the first two weeks of January compared with the same period last year, while just 16% reported a rise. More than half the retailers surveyed predicted that sales would fall further in February. CBI chief economic adviser Ian McCafferty said:
“Most of the retail sector continues to struggle as the recession bites more deeply, and February will be tough,”
“Later this year we hope to see some benefit from recent interest rate cuts, falling inflation, and the Government’s steps to kick–start lending. But retailers will still have to work hard to coax anxious consumers back into the shops.”
The survey revealed that sales were down in all sectors, with the exception of footwear. Durable household goods and clothing retailers reported the heaviest declines, while motor traders saw their sales fall for the eighth month running.
Andy Clarke, retail director of Asda and chairman of the CBI’s Distributive Trades Panel, added:
“The Christmas and New Year trading period revealed mixed fortunes with clear divisions between value and premium retailers. Retailers caught in the middle will continue to suffer as customers vote with their feet.”
“As petrol costs and food inflation have come down and household energy bills are beginning to ease, consumers will have a bit more spending power, but as job losses increase retailers will face a difficult year,” he added.
A British Retail Consortium (BRC) spokesman said the CBI figures reflected a tough year for retailers, but warned that harder times could be ahead.
“Aggressive interest–rate cuts, along with cuts in VAT and sales promotions by retailers will all undoubtedly help towards recovery but the Government also needs to reassess the burdens it places on the sector,” said the spokesman.
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