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Online wins out over High Street

By Retail Technology | Monday January 6 2014

Christmas fails to light up High Street according to latest mid-market retail sales tracker, relying on online sales as the main driver of seasonal growth

Figures released today from BDO's High Street Sales Tracker reveal the UK High Street lost the battle with e-retail for Christmas sales last year.

The Tracker showed overall like-for-like sales among mid-market retailers in December were down 2.2% year on year. While non-store sales, including online transactions stole the limelight, with overall sales up 31.1% on 2012. 

The accountancy firm’s weekly tracker of some 85 mid-tier retailers with around 10,000 stores also recorded an impressive like-for-like increase in non-store sales of 55.7% in the week before Christmas, confirming earlier predictions, the growing popularity of 'click & collect' options and retailers’ own early trading reports.

By category, homewares saw an increase of 8% year on year. And last minute present shopping saw non-fashion sales pick up in the final week, offsetting a weak start to the month, to finish up 2%. 

The Tracker also found fashion sales were down 4.6% overall with poor weather and savvy bargain hunters hitting the sector particularly hard. Although pre-Christmas discounting saw sales pick up slightly at the very end of the month, the firm noted that this was too little too late.

Getting e-commerce technology right

Don Williams, national head of retail and wholesale at BDO LLP, commented: “As anticipated, online sales and 'click & collect' were the real success stories this Christmas and these figures illustrate just how critical it is for retailers to invest in online routes to market. Many retailers will feel disappointed with reduced footfall in stores but when the technology is right this shows that this need not be a disaster.”

He added: “The big rise in the last week of December when we started to see discounting shows that consumers are prepared to hold out until the last minute to pick up a bargain. This suggests that the January sales will encourage shoppers to part with their hard earned cash but there is little room for complacency. January is a cruel month for the High Street as retailers are usually sitting on high cash holdings and low stock levels so they are particularly exposed at this time of year.”

Barclaycard this weekend said that its figures showed spending rose by 2.9% overall compared to the 2012 Christmas period. But it found physical store sales rose by 1.2%, while online spend increased by 9.8% year-on-year from the beginning of November to 27 December.

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