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2012 to be 'challenging' for retailers

Date Added: 16/01/2012  

Retailers may need to take business debt advice in order to avoid the threat of a winding up order this year, as 2012 has been predicted to be "challenging" for firms in the sector.

Stephen Robertson, director general of the British Retail Consortium (BRC), stated 2011 had been a "relentlessly tough" period for retail companies, despite sales figures in December being up by 2.2 per cent when compared to the same month in the previous year.

This statistic is according to the new BRC-KPMG Retail Sales Monitor, which noted the sales volume for the month was the highest recorded since January.

Mr Robertson explained how the figures were due to a "dazzling" week just before Christmas, adding there were also some major one-off contributing factors and claiming there has not been a "fundamental" change in the circumstances of consumers.

He said: "The comparison is with severe snow disruption a year ago. Discounting was deeper and started earlier and the vital Saturday Christmas Eve added another big trading day to the final run-up. Post-Christmas offers brought large numbers of shoppers out but that was generally a short-lived hunt for bargains."

Head of retail for KPMG Helen Dickinson pointed out long opening hours and heavy price cuts were partly behind the sales boost over the course of the festive period.

She noted the figures should not be read as an indication the retail sector is experiencing a turning point, due to the fact that demand is likely to return to low levels for the rest of 2012.

Sales of clothing and footwear were described as being "spectacular" during December, while consumers also bought a lot of food for Christmas celebrations with their families.

Earlier in the year, the BRC predicted 2012 will see a rise in the number of firms in the retail sector that go out of business.

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Posted by Julie Cutts

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