A flat Christmas is the most positive outcome UK retailers can expect.
That’s the gloomy prediction from Deloitte, which has predicted zero growth in retail sales this Christmas.
“Christmas 2011 promises to be the most important moment in retail trading we have seen for many years,” said Richard Hyman, strategic retail adviser to Deloitte.
“Demand has been softening throughout the year as the impact of the government’s debt reduction strategy has started to filter through to the pockets of consumers. Therefore, it is very difficult to see where sales growth will come from this Christmas.”
However, Deloitte has predicted the one bright spot for retailers this year will be online, with sales forecast to top £30bn for the first time, growing by 15%.
“Online retailing was hit last Christmas when the massive nationwide snowfall forced some major players to stop taking orders because delivery became impossible. Assuming no repetition, continued growth in click and collect and increasing access through mobile phones and tablets will help boost sales,” said Ian Geddes, UK head of retail at Deloitte.
Meanwhile, UK retail sales unexpectedly rose 0.6% in October, according to the ONS. But the BRC said the figure “painted a much rosier picture of the state of retail” than it was experiencing.
“The reality is disposable incomes are down on a year ago and customers are cutting back,” said BRC director general, Stephen Robertson.