Heatwave sparks drop in high street sales

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Shoppers stayed away from the high street as they enjoyed the recent heatwave, leading to deepening gloom among retailers who saw a 5.6 per cent drop in sales, according to figures released today.

The warm weather was bad news for the already struggling sector as sales continued to plummet compared to performance this time last year on a like-for-like basis.

A spokeswoman for accountancy firm BDO Stoy Hayward said: "It is not looking healthy out there. Up until now we've been trying to remain positive but the writing is on the wall now."

Analysts said that homeware and non-fashion shops were particularly badly hit, registering falls of 14.1 per cent and 7.3 per cent respectively - the biggest drop in non-fashion sales since heavy snow in early February kept customers away.

The leisure sector and gift shops reported the weakest performance.

Fashion stores suffered less with many having launched early summer sales several weeks ago, but they still saw a fall of 4.1 per cent, according to BDO Stoy Hayward's regular tracking of high street sales.

Footwear, formalwear and lingerie retailers saw the worst drops but niche brands and stores aimed at the youth market performed fairly well.

The recession is also biting on-line which has previously seen significantly better performance than on the high street. Internet and mail orders showed a 20 per cent growth on last year but still grew at their slowest rate since February.

Rupert Eastell, head of retail at BDO Stoy Hayward, said: "For a second consecutive week sales decreased across all three sectors, with overall takings falling by 5.6 per cent. Retailers will be hoping that sales figures will start to improve very quickly, or it could signal problems for a number of retailers."

"The exceptionally warm weather experienced by much of the country generally discouraged high street footfall, while a third week of summer discounting largely failed to stimulate significant new demand.

"Although some stores continue to report consistent like-for-like gains, these are dwindling in number, with some signs that pay freezes and unemployment pressure are now both starting to impact demand in many areas."