Black­friar

Yorkshire Post - Business - - BUSINESS / NEWS - @york­shire­post

Fol­low­ing the heat­wave over the early and mid sum­mer months, the weather has been far chill­ier in Au­gust, bring­ing an end to the re­tail mini boom.

Foot­fall data from the BRC-Spring­board re­vealed dis­ap­point­ing fig­ures for re­tail­ers last month.

Over­all re­tail foot­fall in the

UK in Au­gust fell by 1.6 per cent, which com­pares with a three­month rolling av­er­age of mi­nus

1.1 per cent, 50 ba­sis points be­low trend.

Of the three com­po­nents of the mon­i­tor, shop­ping cen­tres fared the worst with foot­fall 2.4 per cent down year-on-year.

High street foot­fall fell by 2.0 per cent, down against a weak com­par­a­tive of mi­nus 2.6 per cent and well be­low the three-month rolling av­er­age of mi­nus 0.5 per cent.

Re­tail parks, which are the most flex­i­ble for­mat for many, given the ten­dency for more am­ple and af­ford­able car park­ing, wit­nessed a rise in foot­fall in Au­gust of 0.3 per cent, which was bet­ter than the three month av­er­age rate of 0.2 per cent.

No re­gion of the UK was in pos­i­tive foot­fall ter­ri­tory in Au­gust.

An­a­lyst Clive Black at Shore Cap­i­tal said the lat­est eco­nomic data sup­ports the bro­ker’s on­go­ing in­vest­ment themes where it favours the gro­cers, pure play cloth­ing, good dis­coun­ters and cred­i­ble self-help stories.

He said that gro­cery is out­per­form­ing non-food and there is a chan­nel shift in non-food to on­line.

At the same time as these changes, there is an on­go­ing bat­tle for sur­vival for many store-based re­tail­ers.

Deben­hams shares plunged on Mon­day af­ter KPMG was called in to help draft emergency plans to save the trou­bled re­tailer.

The depart­ment store is said to be con­sid­er­ing a list of op­tions in­clud­ing a com­pany vol­un­tary agree­ment (CVA), a controversial in­sol­vency pro­ce­dure used by strug­gling firms to shut un­der­per­form­ing shops.

If Deben­hams charges ahead with a CVA, it would join a raft of re­tail­ers in­clud­ing New Look, Car­petright and Moth­er­care, who have opted for the re­struc­tur­ing tool de­spite anger from land­lords who have ar­gued it leaves them out of pocket.

Mr Black be­lieves that Septem­ber could be tough for the re­tail sec­tor.

“‘Back to por­ridge’ seems to be the mood as many house­holds pay for those more ex­pen­sive beers and G&Ts en­coun­tered abroad fol­low­ing ster­ling’s weak­ness, whilst start­ing to cast an eye to­wards fund­ing Christ­mas,” he said.

How­ever, the cooler weather could help shift cloth­ing and footwear as we head into au­tumn.

Mr Black also sees scope for food prices to nudge a lit­tle higher due to the hot north­ern hemi­sphere hitting crop yields and so feed­ing into higher prices.

Any such in­cre­ments can rea­son­ably be ex­pected to eat into dis­cre­tionary spend.

As such, liv­ing stan­dards may plateau rather than nudge ahead.

As the Con­ser­va­tive Party threat­ens to rip it­self in two over Brexit and the ma­jor­ity of the pop­u­la­tion have no faith in the Che­quers deal, con­sumers face a frosty pe­riod ahead of them.

The heady days of sum­mer and Eng­land’s suc­cess in the World Cup are well and truly be­hind us.

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