Retailers face 2013 gloom as Britons prepare to save
Pressures set to grow and drive high-street stores to close their doors for the last time
Retailers are being warned to brace themselves for a tough 2013 after the first shoppers' confidence figures since the crucial Christmas trading period revealed almost two-thirds of Britons plan to cut spending over the next six months.
Shares in retail stocks tumbled after retail analysis from Conlumino showed that 59 per cent of consumers intend to spend less at Britain's shops over the next six months, with only 2.6 per cent planning to boost spending in 2013.
In response, Marks and Spencer shares were down 3.4p, to 382.3p; J Sainsbury fell 1.9p to 345.1p; N Brown, the catalogue retail giant whose brands include lingerie-seller Figleaves, was off 6.5p to 369.8p. Meanwhile Britain's biggest retailer, Tesco – which issued its first profit warning in more than two decades last January after a poor festive trading period in 2011 – lost 0.2 per cent to 336.6p. Its shares tumbled 14 per cent last year, down from 390p at the start of last January.
The retail sector's fallers crossed the shopping spectrum, including homeware brands such as Carpetright, down 5p to 680p, and Next, down 4.4p at 3703.6p. Next has an established online business, but figures from credit-checking group Experian showed that although Christmas Eve and Christmas Day saw year-on-year increases of 86 per cent and 71 per cent respectively in visits to online retailers, this fell to only 17 per cent on Boxing Day.
Despite some retailers claiming record takings over the festive sales period, the British Retail Consortium is warning this year will be an "ongoing endurance test" for retailers. It is campaigning for the Chancellor George Osborne to halt April's planned increase in business rates, which will hit shop-owners with a £175m bill.
"With the economy bumping along the bottom in the New Year, real incomes still under pressure and consumer confidence low, retail sales can be expected to remain in the doldrums," warned Clive Black, retail analyst at Shore Capital. "With the internet continuing also to gain share, the plight of the high street, the secondary and tertiary towns and retail parks in particular is especially challenging.
"Most retailers, especially supermarkets and the rag-trade, will be praying for a good spring/summer of weather after three grim years, which could help matters – with no Jubilee or Olympics to come. However, grinding out is expected to be the theme. Many small high-street retailers will, sadly, close their doors for the last time through the year."
The proportion of vacant shops in town centres is presently at a record 11.3 per cent, thanks in part to high-profile retail failures including video-games retailer Game, greeting-cards group Clinton Cards, sportswear chain JJB Sports and outdoor-goods group Blacks Leisure. Though each re-emerged in some form, hundreds of stores were closed.
Neil Saunders, managing director of Conlumino, added: "January is when consumers really start to take stock and that's when we expect the realities of a Christmas on credit to start to have an impact on confidence. The outlook for the start of the year does not look too rosy.
"In terms of sales performance, 2012 will probably end on a bit of a high but retailers should be under no illusions that the consumer remains under significant pressure and most households intend to cut spending as they go into the New Year. As such, reports of a bumper sales period should not be taken as the beginning of the end of the consumer downturn."
Children's bookseller wins The Independent's new author search
Board creates magnetic field to achieve lift
- 1 Jack the Ripper: Scientist who claims to have identified notorious killer has 'made serious DNA error'
- 2 Banksy arrest hoax: Internet duped by fake online report claiming artist's identity has been revealed
- 3 Former East 17 frontman Brian Harvey turns up at Downing Street and 'demands to speak to Prime Minister'
- 4 Kentucky gang rape: 15-year-old boy left in critical condition after sexual attack by group at party
- 5 Paralysed man Darek Fidyka walks again after treatment by British doctors on brink of 'cure'
Jack the Ripper: Scientist who claims to have identified notorious killer has 'made serious DNA error'
Oscar de la Renta dead: Legendary US fashion designer dies after long cancer battle aged 82
Oscar Pistorius: The brutal prison life that awaits disgraced athlete
Banksy arrest hoax: Internet duped by fake online report claiming artist's identity has been revealed
Super-sized ships arrive in Britain: How big can they get?
Cameron is warned 'no possibility' of UK reducing immigration and that bid to bring in quota on migrant workers would be illegal
Residents should throw a street party and mix with immigrant neighbours, councils told
Russell Brand threatened with arrest after filming outside Fox News headquarters
London bus driver 'kicks gay couple off for kissing'
Jose Manuel Barroso warns David Cameron against making 'historic mistake' over immigration reforms
Worst Airports of 2014: Poll names Islamabad airport in Pakistan worst in the world
iJobs Money & Business
£23000 per annum + pension and 22 days holiday: Ashdown Group: An established ...
£27000 per annum + pension, 22 days holiday: Ashdown Group: An established ind...
£23000 - £26000 Per Annum: Clearwater People Solutions Ltd: Our client is curr...
£25 - 30k: Guru Careers: A Corporate Actions Administrator / Operations Admini...