High Street Sales Dampened By Rain and Referendum

The UK high street has suffered its worst month since the beginning of the downturn hit by poor weather, uncertainty around Brexit and faltering consumer confidence.
According to the BDO High Street Sales Tracker in April, retailers recorded a 6.1% fall in overall year-on-year sales – the poorest set of numbers since November 2008.
The fashion sector recorded a like-for-like sales drop of 9.2% on the same time last year with sales of lifestyle goods down 0.2%.
Homeware sector sales however did better rising 17.8%.
Sophie Michael, head of Retail and Wholesale at BDO, said April’s unpredictable weather had taken away shoppers’ need for new spring/summer lines and with it, their reason to buy. She added that with consumer confidence particularly weak driven by global events and uncertainty around the ‘Brexit’ referendum, “consumers kept a tighter than usual grip on their wallets” in April.
“With sluggish consumer spending and the cold recent months, retailers will undoubtedly be feeling that everything is against them,” she said. “Consumer confidence will not be helped by the recent high street corporate failures, and with figures like these, there will be a temptation to try and get shoppers spending through wide discounting. Retailers however need to be confident in their product offer, hold their nerve as the weather warms up, and be selective and strategic about promotions. Operating margins have already been squeezed this year through additional costs such as the National Living Wage and the adverse impact of a weak pound, and heavy discounting will only erode margin further.”