Belfast Telegraph

Shops boosted by Christmas sales, but future 'grim'

By Peter Cripps and Clare Weir

A spate of early discounting has helped retailers attract shoppers before Christmas, but the uplift is not expected to last into the new year, a survey revealed.

Business body CBI said retail sales volumes rose in December for the first time in seven months, with a balance of 9% of traders reporting an increase on a year ago when Arctic weather conditions kept shoppers at home.

While some Belfast shops have reported one of their best Christmas trading periods ever, Nigel Smyth, CBI director in Northern Ireland, said that the situation here "may remain grim".

Sales of food, toys and items sold via the internet all enjoyed strong growth.

But consumers remained wary of buying "big ticket items" such as fridges and washing machines, and overall volumes were still below normal.

Expectations for next month remain bleak, with retailers forecasting that volumes will decline again despite it being a time of the year when shoppers are normally attracted by January sales.

Asda chief financial officer Judith McKenna, who is also chair of the CBI's distributive trades panel, said: "Early discounting helped retailers add a little extra sparkle to their sales in December, although the reprieve appears to only be temporary as they don't expect sales to continue to grow into January.

"Consumers are continuing to hold off on purchasing big ticket items, including durable household goods, preferring to use their hard-earned cash to stock up for Christmas dinner and all important gifts for the family."

Department stores reported slightly better sales following four months of declines.

Hardware and DIY stores and shoe shops reported large declines, although clothes sales were flat and furniture and carpet stores enjoyed growth compared with the previous year.

Mr Smyth has said that the overall situation will be reflected in Northern Ireland despite positive reports on footfall and spending compared to last year.

"This is a UK-wide survey and the fact is that many retailers may find themselves struggling not just for months, but for years," he said.

"The situation in Northern Ireland will not be dissimilar to that in other regions and may in fact even be worse."