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December sees spending defined by discounts and the best online sales for the month since 2013

04 January 2020

Deeper and widespread discounting throughout December may reveal consumers have left nothing for January sales

A month of deep and widespread discounting may have lead bargain-hunters to part with their cash early ahead of the January sales, according to figures released today by accountancy and business advisory firm BDO LLP. 

BDO’s High Street Sales Tracker (HSST) revealed particularly positive like-for-like (LFL) sales in the first and last weeks of the month, with non-store LFLs reflecting the impact of Cyber Monday.

With an additional shopping day at the beginning of Christmas week this year, the final week of December saw in-store sales up by +8.59%. However, despite the boost from extreme discounting, total in-store sales still failed to offset a poor base from December last year, with a marginal increase of +0.7% not giving retailers the final month of the decade they’d hoped for. 

Meanwhile, off the high street, non-store like-for-like sales were up by +24.5% as online sales saw the best monthly results since December 2013. With Cyber Monday landing six days later than it did last year, more sustained discounting ultimately defined December sales figures.
The fashion sector suffered in December as in-store sales dropped -2.4% from a poor base of -2.0% last year, dragged down by a significant drop of -9.03% the week before Christmas. This marks the eighth negative December in a row for fashion.

Lifestyle sales however saw growth for the first time since January 2018 with in store sales up by +6.0%, bolstered by strong weeks at the beginning and end of the month (up by +13.25 and +20.08 respectively) as consumers splashed out on Christmas gifts. 

Homeware sales continued to improve too, seeing an uplift of +4.2% this month from an already strong base of +9.3% marking the fourth consecutive month of growth for homewares. 

Sophie Michael, Head of Retail and Wholesale at BDO, said: “In terms of retail spending, December has provided a glimmer of hope for the retail sector as we saw positive first and last weeks of the month as well as a good month for lifestyle and homewares.

“However, this was boosted by extreme discounting, which was qualitatively different this year. Black Friday never quite ended and instead saw sales continue throughout the month.” 

Sophie adds “January tends to be a positive month as people are more inclined to spend in the sales, however it’ll be interesting this year to see if many have already done their bargain-hunting in December. This month’s figures potentially paint a bleak picture for the first month of 2020 on the high street. 

“We’ll only see the real impact of such extensive discounting when retailers publish their bottom-line performances. Discounting helps to shift volume and increase footfall but requires retailers to continue trading on thin margins and thin ice. There’s increasingly an expectation among consumers that there’s always a sale just around the corner.”

ENDS

Note to editors

Accountancy and business advisory firm BDO LLP provides integrated advice and solutions to help businesses navigate a changing world.

Our clients are Britain’s economic engine – ambitious, entrepreneurially-spirited and high-growth businesses that fuel the economy. 

We share our clients’ ambitions and their entrepreneurial mind-set. We have the right combination of global reach, integrity and expertise to help them succeed. 

BDO LLP

BDO LLP operates in 17 locations across the UK, employing nearly 5,000 people offering tax, audit and assurance, and a range of advisory services. BDO LLP has underlying revenues of £590m and is the UK member firm of the BDO international network.

BDO’s global network

The BDO global network provides business advisory services in 162 countries, with 80,000 people working out of 1,600 offices worldwide. It has revenues of $9bn.

Contacts

Ollie Druttman or Sophie Isles    
Tel:      +44(0)20 7758 3900
Email: [email protected]