Skip to main content

Retailers must be optimists

Food and drink sales during June were very strong, increasing optimism among retailers. But the longer term picture remains uncertain.

On Tuesday this week the CBI said that more than half of retailers taking part in its high street survey said that sales were up during June, providing the most positive figures since June 2007.

The CBI's sample includes 20,000 outlets owned by 131 companies and it works by adding up those retailers reporting an increase and taking away those who say sales have fallen.  In June the figure was plus 33 per cent (51 per cent take away 18 per cent), which was much better than the plus 11 per cent figure that retailers had been forecasting.

Looking forward, the forecast for August is plus 45 per cent, which if achieved will be the best result since June 2004.

"Retailers are optimistic that strong sales growth will continue next month, which is promising," said Lai Wah Co, the CBI's economist.

"We still expect the recovery in overall consumer spending to be fairly restrained, however, given concerns about the impact of public spending cuts and weak prospects for real take-home pay in the coming year."

Across London, Brandon Leigh, finance director of PZ Cussons, was offering the following prognosis: "Unemployment is rising and consumers will be quite discerning in where they spend their money. There's acceptance that your basic shower gel and your basic handwash will be on promotion at £1 for quite a time."

There is not much different between Ms Co's and Mr Leigh's prognosis. However, convenience retailers can afford to be optimistic as top-up food shopping and smaller treats are less likely to be hit as shoppers change their habits.

Comments

Popular posts from this blog

Digital disruption in the UK wholesale space

“Twenty years ago I was driving boxes to the post office in my Chevy Blazer and dreaming of a forklift,” says Jeff Bezos in his most recent letter to shareholders. A blink later and he points out that the company has grown from 30,000 employees in 2010 to 230,000 now. But his ambition is the same. “We want to be a large company that’s also an invention machine. We want to combine the extraordinary customer-serving capabilities that are enabled by size with the speed of movement, nimbleness and risk-acceptance mentality that is normally associated with entrepreneurial start-ups.” Amazon is great at disruption because of its customers focus and the fact that the internet means it needs none (or very few) people between its warehouses and the shopper. The threat of Prime, its membership service, is the biggest challenge facing the UK retail market and the wholesale market by extension. It is both a direct threat and an indirect threat in that is inspiring countless numbers of othe...

Five things to learn from Waitrose

Interim results from Waitrose this week confirm the industry figures that show the upmarket supermarkets and convenience stores are leading the market (albeit from a 4.2% share according to Kantar Worldpanel). Charlie Mayfield, the chairman, highlights many reasons for its success and here are five that local retailers should consider. Marketing works. Waitrose claims that more than 370,000 extra customer transactions resulted from its spring tie-up with Delia Smith and Heston Blumenthal in the first eight weeks. This autumn, it launches a cookery school. Engaged shoppers are more profitable shoppers! You need a value offering. 17 per cent of Waitrose sales are from its value range, called essentials. Momentum works. Its strategy is to bring Waitrose to more people in more places. It invested in 75,000 square feet of extra selling space in the first half of this year, including three convenience stores. In the second half of the year, it is adding eight convenience stores. Str...

The secrets of persuasion: No short cuts.

The best moment in my interview with Terri Sjodin, who teaches many of the world’s top corporations how to sell persuasively, is when she smiles at me and asks to hear my “elevator speech".   My mind literally goes blank. The author of Small Message, Big Impact , her new book on how to craft powerful messages that persuade people to listen to you, has thrown the gauntlet at me. There was nowhere to hide. I had just told her how I had used her book to write out my three minute speech to open the Local Shop Summit. She listened patiently to my pitch, thought for a moment, and said: “I bet you had an illustration in your mind of an independent who really capitalised on your ideas and has taken them to the bank.” I could swear she was reading my mind. I blushed and nodded. “So you should open with this story,” she said. “Start out by saying: ‘Let me open the conference by telling you a great story with a happy ending.’ So the audience will say to themselves: ‘He is goi...