Retail sales surge driven by discounts

NIGEL BOURNE: "Value and profitability will have remained subdued"
NIGEL BOURNE: "Value and profitability will have remained subdued"

SALES growth for retailers improved during December after a slow start to the Christmas period, according to the latest CBI research.

But the CBI's Distributive Trades survey also showed that while stores were successful in shifting volumes, it appears that price discounting played a greater role than in previous years.

The CBI’s November survey suggested retailers were bracing themselves for a disappointing Christmas. This survey suggests some retailers took pre-emptive action to encourage shoppers into stores.

The survey shows 53 per cent of firms reported sales volumes were up on a year ago, while 20 per cent said they were down. The positive balance of plus 33 per cent compares with plus 19 per cent in November.

Despite the pick-up, sales were rated as only average for the time of year. Retailers also reported caution about the prospects for the January sales.

Sales are expected to be only average for the time of year, which is traditionally a vital period for the retail trade.

Nigel Bourne, CBI regional director for the South East, said: "Many retailers were concerned by the slow start to Christmas. But in the event they encouraged cautious consumers into the shops.

"However, if as is likely, widespread discounting drove December's increase in sales volumes, then value and profitability will have remained subdued."

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