December delivers Christmas present to high street traders

11 January, 2008

Festive season proves successful despite flat run-up and intense competition

Retailers

reported encouraging sales growth

over

Christmas , with December

making up for a flatter November.

Wine Cellar's general trading manager, Steve Parker, said : "The actual Christmas period was extremely successful for us . Prior to that it was a little bit flat but I think that relates to the multiples' activity since the summer."

Tesco

head of BWS Dan Jago said: "We grew our business year

on

year as you would expect. We had a strong Christmas in some areas, other areas were very challenging."

Majestic's like-for-likes in the nine weeks to Dec 31 were flat at 1.2 per cent, although sales increased by 4.1 per cent in the last five weeks of that period. Chief executive Tim How blamed consumer caution for a "disappointing November".

Independent retailers have reported strong trading, with both York Beer & Wine Shop and Leeds' Beer Ritz - run by OLN columnist Zak Avery - enjoying record sales before Christmas.

Alcohol sales at retail symbol group Nisa-Today's rose 8 per cent in December, helping the company achieve overall growth of 5.1 per cent.

Suppliers also sounded positive about festive results. Nigel McNally, managing director of Wells & Young's, said: "We had a very good Christmas, and the off-trade was fantastic. Sales were significantly better than last year." John Mills, managing director of Gaymer Cider Company, said sales were strong but he was "concerned by the depth of discounts and deals

we saw".

Total off-trade sales grew above inflation in the 12 weeks to Dec 29, according to Nielsen, wh ich is expected to publish official figures next week.

Nielsen analyst Graham Page said: "December's growth will have helped an otherwise rather less than spectacular year." He added: "Our impression is that nearly 50 per cent of booze has been on discount or promotion in December, so while some volume numbers showed improving growth trends in December, whether margins were maintained or improved is quite another issue.

"The market appeared intensely competitive in all channels, with some very low prices

relative to inflation and cost of product."

Majestic's How

warned

retailers are likely to have to run deeper discounts in 2008 to encourage cautious consumers to spend. Jago said it was "too early to say" whether Tesco would adopt a similar approach.




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