Retailers experience a grim start to the ‘Golden Quarter’

Retailers experience a grim start to the ‘Golden Quarter’

  • Total like-for-like retail sales in October fell by -1.7% 
  • In-store LFLs sales recorded the first negative result since February 2021 
  • Online sales fell for the third time in 2023
  • Fashion in-store sales suffered particularly badly, falling -2.3%  
Retailers have recorded a disappointing start to the crucial “Golden Quarter”, as total like-for-like (LFL) sales in October have declined by -1.7%, compared to last year’s positive base of +3.5%, according to new data from accountancy and business advisory firm, BDO. 

BDO’s latest High Street Sales Tracker also highlighted that in-store sales fell –1% from a base of +5.9% for the same month last year, marking the first set of negative in-store sales figures since February 2021. This was reflected in online spending too, with online sales falling for the third time in 2023, down -1.8%.

Sophie Michael, Head of Retail and Wholesale at BDO LLP, said: “These results make for a grim start to the run up to the festive season for retailers, traditionally their best time of year. 

"We expect to see retailers discounting in November as they gear up for Christmas with many marking Black Friday and Cyber Monday, but it’s likely that they will have to bring in deeper discounts than planned, as competition for discretionary spend intensifies.

“Weaker discretionary spending in the build up to Christmas will be a concern for retailers, who rely on the so-called ‘Golden Quarter’ to bolster revenues ahead of January, when consumers are usually expected to tighten the purse strings. With businesses already squeezing profit margins and interest rates and energy bills remaining high for the foreseeable future, this fall in consumer spend could be the beginning of a period of significant pain, which may extend well into the New Year.”

Sector Results

It was poor month for the fashion sector, which saw total LFLs fall by -2.3% from a base of +6.7% for October 2022, as we witnessed unseasonably warm weather in the first three weeks of the month meaning consumers may choose not to freshen up winter wardrobes. 

Total LFLs for the lifestyle and homeware categories also declined, despite in-store sales for lifestyle products increasing by +3.4%. 

Sophie continued:
“We’ve seen recent reports that suggest consumers plan to cut back on spending and purchase fewer gifts during the festive period. Retailers will need to work extra hard to attract consumer spend in these conditions, including optimising product availability, in-store and online experiences as well as pricing and promotions in order to muster up some festive cheer.” 

Note to editors

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

The organisations we work with are Britain’s economic engine –entrepreneurially-spirited, high-growth businesses that fuel the economy.  

We understand the ambitions and entrepreneurial mindset of those we work with and have the global reach, integrity and expertise to help people and businesses succeed.  

BDO LLP operates in 18 offices across the UK, employing 7,500 people offering tax, audit and assurance, and a range of advisory services. BDO LLP is the UK member firm of the BDO international network.

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Fergus Lynch 
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