Golden Quarter gets off to a dull start as inflation haunts shoppers
Golden Quarter gets off to a dull start as inflation haunts shoppers
- Total like-for-like retail sales in discretionary categories across in-store and online dipped -0.02% in October, ending four months of positive sales results
- Store sales rose by +1.1%, outpacing online for a second month
- Weak sales came as households faced stubborn food inflation and uncertainty ahead of the Autumn Budget
Retailers entered the Golden Quarter on shaky ground as high inflation and weak consumer confidence weighed on October sales, according to the latest High Street Sales Tracker (HSST) from accountancy and business advisory firm BDO.
Total like-for-like retail sales across discretionary categories (fashion, homewares and lifestyle) were broadly flat this month, slipping -0.02% and ending a four-month run of positive sales results.
Store sales continued to show some resilience, rising +1.1% and outperforming online for a second consecutive month.
Weekly data for the four weeks to 26 October revealed an uneven month: sales fell in the first and final weeks but strengthened mid-month, suggesting intermittent consumer confidence. The final week, coinciding with the start of school half-term holidays, saw declines across in-store and online channels as families feeling the pinch prioritised spending on experiences and travel over retail purchases.
Sophie Michael, Head of Retail and Wholesale at BDO, commented: “Our data makes for rather frightening reading for retailers this Halloween. After several months of positive momentum, October has brought a sharp reminder of how fragile consumer confidence remains. As we predicted last month, shoppers are still haunted by high inflation, particularly on food, while uncertainty about their household finances is keeping a firm grip on discretionary spending. Consumers are being highly selective and many are prioritising spending on essentials and experiences rather than non-essential goods.
“The timing of this year’s Autumn Budget, just two days before Black Friday, adds another layer of pressure. Retailers are being forced to make critical investment and promotional decisions without a clear view of the fiscal landscape.
“After a disappointing October, we expect to see earlier and more prolonged discounting to stimulate demand. But that strategy has its risks. Heavy discounting too soon erodes margins and leave businesses with a tough start to the new year. Retailers will need to strike a careful balance, using promotions strategically to keep customers engaged while protecting profitability.
- Ends –Note to editors
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