Sales boost for retailers ahead of crucial weekend

The hopes of retailers ahead of the busiest shopping weekend of the year were raised yesterday by official figures suggesting sales were resilient in November, despite the snow disruption at the end of the month.

The Office for National Statistics said retail sales by value, excluding fuel, jumped by 3.6 per cent in November on the same month last year, with clothing and footwear chains the top performers. This suggests that retailers are passing on price increases, as sales by volume rose by only 1.1 per cent last month – ahead of the 0.7 per cent growth expected by economists.

Barry Knight, the head of retail at Grant Thornton, the accountancy firm, said: "The rise in the November retail sales is particularly good news as it compares to the reasonably strong sales achieved in November 2009."

He added: "We have seen strong performances in clothing and footwear, with November's cold period driving boots, woollens and coat sales."

Sales by value of clothing and footwear jumped by 9.1 per cent in November, but shops selling household goods slumped 5.9 per cent, laying bare how nervous consumers are about purchasing big-ticket items. Last month's data was also bolstered by the continuing surge in online sales, which now accounts for 10.5 per cent of total retail revenues in the UK. The averageweekly online sales total rose by 36.6 per cent to £660m in November.

The robust retail sales come ahead of the crucial last weekend before Christmas, with retailers keeping their fingers crossed that the heavy snowfall forecast for some regions this weekend doesn't prevent shoppers fromventuring out. The ONS data followed the Confederation of British Industry reporting on Wednesday that UK shops enjoyed their strongest sales for more than eight years between 25 November and 8 December.

But retail sales volumes rose by only 0.3 per cent between October andNovember, which was less than the 0.7 per cent uplift predicted by economists. While this was partly dented by October's increase being revised up from 0.5 per cent to 0.7 per cent, the British Retail Consortium said the ONS data showed "how delicately balanced the retail sector is ahead of Christmas".

Research from Pricewaterhouse-Coopers suggests promotions are at an "all-time high" in the grocery sector. On 11 and 12 December, an average of 11 out of 20 items were on promotion, compared with nine a week earlier. PwC's Christine Cross said: "The grocers are leaving nothing to chance."

Return of the small shops?

Small shops are fighting back against the big supermarkets and appear to be thriving in many instances, reveals the Office for National Statistics.

It said that smaller specialist food shops, such as butchers, bakers and delicatessens, grew annual sales volumes by 3.6 per cent last month, ahead of the lacklustre 0.7 per cent growth at the grocers or non-specialist food shops.

Moreover, retailers with between 10 and 39 employees enjoyed a 11.5 per cent rise in sales in November, compared with 4 per cent at those with more than 100 staff. The performance of shops with between 40 and 99 employees was worse with sales down 1.9 per cent.