A “challenging” New Year means retailers will have to put large discounts on stock during the first half of 2008 to boost sales, the British Retail Consortium (BRC) has warned.
BRC director general Kevin Hawkins said tighter consumer spending means retailers will need to do more to draw customers in.
“With customers short on spare cash and nervous about how their finances will shape up in the New Year, it’ll be a bumper January sales with bargains to be had as stores compete to tempt customers in,” he said.
“Retailers who haven’t done the business they expected to before Christmas will be very keen to cut their losses and shift whatever seasonal stock they’ve been left with.”
Supermarkets dramatically cut prices of beer wines and spirits before Christmas to boost sales, but some are continuing to offer discounts throughout January.
Morrison's is giving up to £10 off selected bottles of Champagne and sparkling wine until Jan 7, while Co-op and Sainsbury’s have both confirmed discounts of up to £3 on selected wines.
Threshers has re-launched its three for two deal on wine and Champagne with a high-profile ad campaign to lure customers into shops and wine merchant Berry Bros & Rudd is offering discounts of up to 30 per cent on wine in its annual sale, which starts today.
Many retailers will be hoping for a better January after recording the weakest sales growth in over a year during the first two weeks of December, according to the Confederation of British Business’s December Distributive Trades Survey.
While 42 per cent of businesses saw sales volumes grow year-on-year in the first half of December, 33 per cent said they had fallen.
However, Majestic bucked the trend, seeing sales pick up in December after a “disappointing November”. Like for like sales for the five weeks ending Dec 31 were up 4.1 per cent on the previous year, chief executive Tim How said in a trading statement today.
Asda, too reported a good Christmas. "January will be a quiet month in terms of promotions as we had strong Christmas and New Year sales so we don't have much stock hanging around that we need to get rid of," a spokesman said.