Retail sales figures for December will reflect a poor Christmas season, the British Retail Consortium said on Thursday as fears grow that the country is entering a deep recession.
A traditional last minute rush for gifts and heavy discounting in the run up to Christmas had raised hopes consumer spending might hold up through the festive season even though the country is entering its first recession since the early 1990s.
But several high profile retailers have collapsed in recent weeks and the BRC — which publishes one of the most closely watched retail sales surveys in Britain — said conditions were tough and Britons were struggling.
“We’ll see the full December figures in a few weeks, but they won’t be pretty,” British Retail Consortium Director General Stephen Robertson said in a statement.
“Despite a last minute surge, it’s becoming clear that overall this has been a poor Christmas for retailers, as struggling customers cut back and traded down.”
Some retailers launched their post-Christmas sales on the Internet on Christmas Day itself, hoping shoppers have been holding back in anticipation of better deals.
But the BRC said big price cuts and fierce competition would put businesses under further pressure.
“Discounts and promotions on a scale unprecedented for the run-up to Christmas, combined with weak sales, have put margins under severe pressure,” Robertson said.
The BRC will release its December retail sales figures on January 13. In November, retail sales fell at their sharpest annual pace in more than three years, according to BRC figures.