Retailers face a bruising start to the crucial final quarter of the year, after the first half of September ushered in the worst trading on the high street for 16 months, according to an influential survey yesterday.
Ahead of the fourth-quarter rent day tomorrow, the only ray of hope forembattled chains was that the pace ofdecline in sales volumes "stabilised" between 25 August and 14 September, according to the CBI Distributive Trades Survey.
While many large retailers, including Next, Debenhams and JD Sports Fashion, continue to growprofits, more evidence of the squeeze on consumer spending emerged yesterday.
Game Group, the computer games retailer, posted a painful £51.5m half-year loss, while Topps Tiles, the home improvement specialist, forecast its underlying sales would be down by 1.9 per cent over the year to 1 October, although the City expects profits of up to £13.4m.
The CBI did little to lift the gloom when it said 39 per cent of retailers suffered a fall in sales volumes in the first half of September, while just 24 per cent posted a rise. The net balance of a negative 15 per cent was the worst performance since May 2010.
Judith McKenna, the chair of the CBI Distributive Trades Panel and chief operating officer at the grocer Asda, said: "Consumer confidence continues to be bruised by a combination of low wage growth, high prices and rising unemployment. Shoppers are still clamping down on discretionary spending and focused on buying the basics at the best price."
While the CBI's September figures were worse than expected with the fourth consecutive month of falling sales volumes, they were almost unchanged on the negative balance of 14 per cent in August.
The CBI found all retail sectorsregistered lower sales and a balance of 30 per cent of retailers described sales as "poor" for this time of year.
The picture was ugliest for retailers selling homewares such as furniture and carpets, which recorded a negative sales balance of 59 per cent.Reuse content