Tuesday 9 July 2013

Warmer weather helps boost retail sales - The Guardian

A washout spring for retailers has given way to a sun-assisted summer revival, with an outbreak of hot weather leading to a second consecutive monthly sales increase.

The British Retail Consortium said total sales for June were up 1.4% on a like-for-like basis, following a rise of 1.8% in May. .

Helen Dickinson, the director general of the BRC, said: "Despite challenging economic conditions continuing, June saw another strong performance from the UK's retailers. At this halfway point in the year we are able to see that sales are well ahead of the previous six-month period."

Sales growth of 2.3% since the start of the year is ahead of last year's annual growth of 1.5%. The strong figures are a further boost for a UK economy that is heading for growth of around 0.5% in the second quarter and is dominated by service industries such as retail.

Clothing was the best-performing category, according to the BRC, although this was mainly due to poor spring weather leaving clothes rails packed with unsold summer outfits that were then sold at a discount in a bid to shift stock.

David McCorquodale, head of retail for KPMG, which compiled the data, said: "It's difficult to say at this stage how much discounting went on, but we know that the cold weather meant retailers were forced to try and shift the extra stock they had."

Several clothing retailers have issued profit warnings or delivered lower-than-expected results this year because of the weather. On Tuesday Marks & Spencer is expected to blame the weather for a fall in clothes and general merchandise sales over the past three months.

McCorquodale added: "Periods of sunshine helped to lift the gloom on the high street and retailers celebrated another month of rising sales. These figures certainly underline the impact that weather can have on a retailer's performance."

DIY and gardening centres also got a well-needed boost in sales after suffering a washout over Easter, a period seen as more important to the chains such of B&Q and Homebase than Christmas. Food sales also rose by 1.4% in June, despite tough comparisons with the diamond jubilee last year, with sales of drinks and ice creams increasing as the weather improved. The earlier timing of Ramadan also helped stimulate sales, the BRC added.

Online sales were up 14.1% on a year earlier, strongly ahead of the 10.5% long-term average. However, house textiles and home accessories were the worst-performing categories as they struggled against last year's jubilee boost and shoppers spending more on fashion.

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