November shopping patterns raise fears for December, but fashion stays buoyant

By

Sandra Halliday

Published
Dec 9, 2022

There have been lots of reports about Black Friday being better than expected in the UK, but with a few reports also saying that returns have been heavier since then.

 
And now the monthly retail sales reports are starting to be released, we can take a wider view of what actually happened last month.
 
The regular BDO High Street Sales Tracker (HSST) on Friday showed that “heavy discounting in the run up to Black Friday and Cyber Monday has driven a small uplift in retail sales, amid high inflation and ongoing lows in consumer confidence”.

BDO said total like-for-like (LFL) sales climbed by 4.1% compared to November 2021 but in-store LFLs — at +5.5% — saw the lowest uplift since February 2021. Total non-store sales also rose by the same amount and the overall results “raise concerns” that many shoppers “have already completed Christmas shopping in [the] Black Friday period”.
 
The 4.1% rise came after a 32.1% increase in the same month last year, which was understandable, given that the comparison period back then was with 2020, which was heavily impacted by the pandemic. 
 
This November opened with a weak initial performance, with total LFLs recording a rise of 0.2% against the corresponding week in November 2021. The second and third weeks of November saw stronger performance, as retailers kicked off their Black Friday offers, with total LFLs jumping by 7.25% and 7.3%, respectively. In the final week performance dropped off, with total LFLs growing by 4.26% against the November 2021 base. 

While the middle two weeks carried November total LFLs to the best monthly results since July 2022, this also marks the fourth consecutive month of below-inflation growth rates.
 
But there was a crumb of comfort for fashion as total LFLs here  rose by 8.5% in November. Again, that was just below the inflation level but it made it the strongest-performing segment throughout the month and marked the 21st consecutive positive month for the sector. 
 
Sophie Michael, Head of Retail and Wholesale at BDO LLP, said: “Although we have seen positive LFL results in November, these figures are still running significantly below inflation, highlighting that sales volumes are likely to be significantly down. With retailers bringing in much earlier and more substantial Black Friday discounts than many expected, there is a real risk that they have cannibalised their own December sales, as many consumers will have completed their Christmas shopping already. With the consumer purse already under so much pressure, it would be no surprise to see retailers record weak sales in December.
 
“Although footfall increased over November, this did not translate into significant increases in in-store sales. Consumers are clearly reducing their discretionary spending and this will no doubt feed through into lower basket sizes. Disruption to public transport across the UK in December will also put further pressure on in-store sales.”