Retailers buoyed by sales growth
Updated on 10 November 2009
Retailers enjoyed their best October sales growth for seven years last month, the British Retail Consortium (BRC) has said.
The 3.8% like-for-like growth was the best for the month since 2002 - but this was set against "dreadful" sales a year earlier as the financial crisis shook consumers.
With 44 shopping days until Christmas, a fierce fight among retailers is already developing for cash from hard-pressed consumers.
Among the UK's supermarkets non-food sales are already being hotly contested because easing inflation has seen food sales growth slide to its lowest level for 19 months, standing at 2% in the three months to October.
Tesco, Sainsbury's and Asda - the UK's three biggest grocers - have all launched a price war on toys as retailers look to make up the gap created by recession casualties such as Woolworths last year.
BRC director general Stephen Robertson said: "Shops have already started to battle it out for customers with a string of promotions and discounts."
With the end to the temporary VAT cut looming in January and tax hikes next year whoever wins the election, retailers are determined to have a good festive season.
Helen Dickinson, head of retail at survey partner KPMG, said: "The longer-term outlook remains considerably more challenging, given the economic backdrop, levels of unemployment, uncertainty regarding the impending VAT rise and the impact of future fiscal policy following next year's election."
The BRC said homewares and furniture sales showed decent gains in October thanks to slight improvements in consumer confidence and the housing market, while half-term holidays and the Halloween celebration also boosted spending.
The BRC's more upbeat survey data is yet to be reflected in official data, which showed the second month in a row of zero growth in retail sales volumes during September.
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