January sales bring surprise boost

Retail sales rose in January as shoppers were tempted by discounts
12 April 2012

The January sales helped retailers enjoy a surprise rise in trade last month but the figures failed to allay fears high streets will be blighted by more shop closures.

Sales volumes rose 0.9% between December and January, the strongest performance since the royal wedding and defying City expectations of a 0.4% fall, the Office for National Statistics (ONS) revealed.

Cash-strapped consumers splashed out on furniture and sportswear as a blizzard of promotions dragged shop price inflation to its lowest level for more than two years. But experts warned the discounts were unsustainable and high streets still face "another difficult year".

A separate survey fuelled fears for the high street as it revealed that chains shut an average of 14 town centre shops a day last year as they increasingly shifted to retail parks and on to the internet. It warned further closures were expected.

The ONS figures do not reflect the full extent of the gloom on the high street, because much of January's growth was driven by internet sales and supermarkets.

British Retail Consortium director general Stephen Robertson said: "These numbers are slightly better than we would have expected but make it clear that price-cutting by retailers is what's driving any growth in business. Discounting is biting into retailers' margins with non-food businesses facing particularly tough times."

The ONS figures were still seen as a welcome surprise, boosting hopes that the UK's economy can stave off another recession after the 0.2% fall in GDP in the final quarter of 2011.

The figures produced by the ONS are seasonally adjusted because January is normally a weaker shopping period than December, but they show that sales volumes in January were 2% higher than a year ago. Excluding car fuel, volumes increased 1.2% between December and January.

Analysts had expected sales volumes to fall in January because many retailers brought forward special offers to before Christmas, sparking fears the normal January sales would have lost some of their traditional appeal.

Household goods sales saw their first sales growth for nearly a year, up 4.8% between December and January, as furniture stores put in a particularly strong performance with high levels of discounting. The ONS also said there was anecdotal evidence that sportswear retailers had enjoyed a strong month.

Create a FREE account to continue reading

eros

Registration is a free and easy way to support our journalism.

Join our community where you can: comment on stories; sign up to newsletters; enter competitions and access content on our app.

Your email address

Must be at least 6 characters, include an upper and lower case character and a number

You must be at least 18 years old to create an account

* Required fields

Already have an account? SIGN IN

By clicking Create Account you confirm that your data has been entered correctly and you have read and agree to our Terms of use , Cookie policy and Privacy policy .

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.

Thank you for registering

Please refresh the page or navigate to another page on the site to be automatically logged in