British spending habits “bleak” as growth falls to new low
Massive high street discounts lure in shoppers, but retail figures still fall
British spending habits remain “bleak” as uncertainty over Brexit and a December election have left shoppers “nervous” about the future of their country
While high street spending rose 0.6 per cent year-on-year, for the first time since July, this was due to an “extraordinary period” of discounting by retailers in a bid to lure in shoppers.
According to a report by the British Retail Consortium (BRC), the longer-term outlook remains “bleak”, with 12-month average sales growth falling to a new low of 0.1 per cent.
BRC chief executive Helen Dickinson said: “With Brexit still unresolved and a December election creating new uncertainties, retailers will be looking nervously at the months ahead.”
The BRC report is backed up by a consumer confidence survey from Barclaycard, which agrees Brits are cautious about their spending. They found expenditure rose 1.5 per cent in October, which is a slower growth than 1.6 per cent in September and narrowly behind the current rate of inflation.
This news follows Mothercare’s announcement that it is the latest victim of the retail downturn. The troubled baby products business has appointed administrators.
After 58 years of trading, Mothercare says it can no longer compete with online stores and supermarkets, is “unable to continue to satisfy the on-going cash needs of Mothercare UK”.
It’s not just the retail industry that is suffering. The number of UK companies entering administration has risen by more than a third in the past three months, with hospitality, travel, manufacturing and construction all victims of the Brexit curse.
Barclaycard found that 22 per cent of consumers spent less than usual in October on leisure activities and evenings out. This impacted entertainment, such as concert and theatre tickets, which fell by three percentage points, while pubs and clubs’ increase of 5.5 per cent was down from 12.9 per cent in September.
Esme Harwood, director at Barclaycard, said: “Ongoing economic uncertainty combined with a bleak start to autumn led many Brits to stay in rather than spend out last month, choosing takeaways and evenings at home over socialising at bars or restaurants.”