Retail sales volumes grew in the year to December 2011 for the first time in seven months, though sales were considered poor for the time of year, the CBI said today (20 December 2011).
Publishing its latest monthly Distributive Trades Survey, which covers the first two weeks in December 2011, the business organisation said retailers did not expect December’s modest sales growth to continue into the New Year, with annual sales volumes falling again in January.
While 41% of companies said sales rose on a year ago in December 2011, 32% reported a fall, giving a balance of +9%. This was better than expected, and the first year-on-year sales growth since May (+18%), said the CBI.
However, volumes of sales were poor for the time of year, with a balance of -16% well below the long-run average, the Confederation added. The three-month moving average, which smooths out monthly peaks and troughs, was negative for the fifth month running (-7%) and is expected to remain so in January, it said.
There was a mixed picture across the sub-sectors, albeit with some notable improvements, the survey found.
Grocers saw their sales volumes rise on a year ago (+52%), as did recreational goods; which includes sports equipment, toys and games (+44%) and the non-store category (+91%), which takes in mail order and online.
Non-specialised retailers, such as department stores, posted better sales this month (+1%) following four months of decline.
Sales volumes fell on a year ago, however, for all sellers of big ticket durable household goods (-100%), which include washing machines and fridges. Hardware and DIY stores fared little better (-70%), although sales of furniture and carpets grew (+43%) for the third month running. Footwear and leather goods fell (-77%), while sales of clothing were merely flat (0%).
Judith McKenna, chair of the CBI Distributive Trades Panel and Asda chief financial officer, 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.”
The volume of orders placed on suppliers was broadly flat (-4%) on a year ago in December, having fallen fast in November (-24%), the survey found.
Among wholesalers, 52% saw sales volumes rise, while 9% reported a fall, giving a balance of +42%. Sales are expected to be broadly flat in January (-2%), said the CBI.
Motor traders have seen sales fall for an entire year, with a balance of -47% in December, and further negative expectations for the New Year (-53%).