UK: Midmarket Retailers In For A Cold Christmas - Analysts
Struggling UK retailers, especially those in the shrinking middle-market such as Marks and Spencer, face a tough Christmas, retail analysts are warning. The crippling fuel crisis, rail chaos, flood misery, atrocious weather and a slow housing market are keeping shoppers away from stores. Experts already estimate that the recent chaos in the last fortnight has cost stores £120 million and they say the downward spending spree will be difficult to reverse. And they are warning retailers to think hard about what promotions they can offer to attract more customers into their stores. Analysts fear the only winners this Christmas will be the customers, as stores are forced to offer more promotions to attract more shoppers. Hayley Myers, a retail analyst with Retail Intelligence, says stores like Boots are already setting the trend with promotions. She said: "Stores have got to be realistic and not make a bad situation very much worse. It's a tough environment, especially in the middle ground, and they have got to get on with increasing their market share." The run-up to Christmas is a crucial selling period for retailers, with many taking a big proportion of their annual sales over this period. The situation did not get off to a good start for retailers this autumn, as revealed by the British Retail Consortium's monthly survey. October saw total retail sales grow slowly to 4.1 per cent, compared with 5.4 per cent in September. Sales in October were just 1.5 per cent higher than a year ago - one of the survey's slowest growth rates this year. A spokesman for the BRC said that there was little doubt that sales growth had peaked and with current conditions, retailers face a tough time catching up on lost ground over Christmas.
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