July sales comparable to Christmas

July saw retailers attract customers with Christmas season-style sales, despite the month’s heavy rains. Total sales rose by 3.6 per cent in July compared with a year earlier, after increasing by 3.2 per cent in June, said the British Retail Consortium.

Stephen Robertson, director of the BRC, said that summer sales were much earlier and deeper than normal. “Promotions were at the level normally found at Christmas,” he said.

Far from being discouraged by the July rain, shoppers splurged on purchases normally made later in the year, such as furniture and autumnal clothes, said the BRC.

But it also said the stronger high street sales came in part because of the comparison with weak spending in July 2008. Shopping from home was also stronger as internet and mail order sales rose by 20 per cent compared with a year before – the best monthly result this year.

Executives in the retail industry had been surprised by the strength of sales in the past few months, said Mr Robertson, which they put down to pent-up demand and revived confidence among consumers.

But retailers are wary of predicting a sustained improvement, with unemployment already running at its highest level since 1996 and expected to increase.

“They are having a more benign trading environment than they expected but there is real resistance to saying that the difficulties and challenges are over,” said Mr Robertson.

Companies’ profit margins were wafer-thin because of the sharp discounting.

Source: FT