British retailers suffered a sharp slowdown this month with business falling at supermarkets and department stores as January sales drew to a close, according to a business survey.
The latest snapshot of retailers from business group, the CBI, showed sales barely rose on a year ago, a much worse performance than City economists and retailers themselves had been expecting. Echoing other signs of pressure on retailers as they resort to discounting to attract consumers, the survey showed prices and headcount falling.
In the survey of 62 retailers, 30% of respondents reported sales volumes were up on a year ago, while 29% said they were down, giving a balance of +1%. That was the lowest reading since November 2013 and below retailers’ expectations of +42% in January’s survey. Economists polled by Reuters had forecast sales growth would slow only slightly in February, predicting a balance of +34 in February after +39 in January.
The report pointed to more tough trading conditions in the months ahead, with orders from suppliers falling this month, investment intentions being scaled back and retailers planning to cut more staff. The CBI said companies remain optimistic sales volumes will grow in March but that “expectations have moderated significantly from recent highs”.