World Cup clouds retail figures

10-07-2007

World Cup clouds retail figures
Improved year-on-year high street sales are covering continuing instability in the retail sector, the British Retail Consortium (BRC) says.

Its monthly retail sales monitor, prepared in conjunction with accountancy firm KPMG, records three per cent growth in June 2007 on corresponding figures 12 months ago.

Although the football World Cup boosted food sales last year, making the comparables much harder than normal, the BRC insists today's statistics do not signal a resurgence of Britain's high street after an uncertain first half of 2007.

It argues that the prospect of more interest rate rises have pushed concerned consumers into spending now rather than later, pushed on by heavy price discounting as the summer sales get underway.

"Given [negative] comments by many retailers over the past few weeks, these may appear a slightly surprising set of results," Helen Dickinson, head of retail at KPMG, commented.

"But they mask a complete reversal of the trend prevalent for many months – food and drink was not the driving force behind them."

She said non-food sales, which drove June 2007's figures, had weak comparables because peak trading periods last year fell during England games.

"These comparatives… have generated some strong results, particularly in the home-related sectors. Although encouraging at the sales level, the impact of the high discounting on margins will be felt as the year progresses."


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