High Street sales give cause for optimism

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Retailers report slight rise in sales volumes for year to September.

Retailers reported a slight rise in sales volumes in the year to September, along with the expectation that growth will strengthen somewhat next month, the CBI said today.

In the CBI’s latest monthly Distributive Trades Survey, covering the first two weeks in September, 33 percent of retailers reported that sales volumes were up on a year ago and 27 percent stated that sales had fallen.

The resulting balance of plus six percent was in line with expectations and an improvement on last month’s weaker performance of negative three percent. Looking ahead, retailers expect a somewhat faster sales growth in the year to October of plus 15 percent.

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While the volume of orders placed on suppliers was broadly flat at negative two percent, this was still a marked improvement from last month’s year-on-year fall of negative 11 percent and beat expectations of another decline of negative eight percent.

Stock levels also fell back relative to the expected demand of positive four percent and are now at their lowest since September 2009.

Nonetheless, for the fifth consecutive month, high street retailers considered the volume of sales to be significantly below average for the time of year.

Chair of the CBI Distributive Trades Panel and Asda chief operating officer Judith McKenna said: “It is encouraging that sales on the high street have seen a slight rise in the year to September, and that retailers expect growth to pick up further next month.

“However, while the squeeze on family budgets may have eased in the short term thanks to the fall in inflation, on-going economic fragility, reflecting uncertainty around the international outlook, could affect household spending later in the year.”

Elsewhere, while sales volumes for wholesalers were broadly flat on a year ago at negative two percent, this was an improvement on falling sales over the previous two months, and comfortably above expectations of another strong decline of 29 percent.

 

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