"After a challenging year, retailers were very much hoping for a strong end to 2025. Instead, we've seen a downward trend since early in the year and the worst monthly performance since November 2024. With a late Budget bringing economic uncertainty, the sector saw a disappointing October and November. Retailers were expecting some of the lost sales to be made up in the final weeks leading to Christmas, but December failed to generate some much-needed festive cheer."
"Due to persistent food inflation and high living costs, consumers reduced their discretionary spending over the Christmas period, focusing on festive food, drinks and experiences instead of products. Continued economic uncertainty and low consumer confidence were also driving down spending. This creates further concerns for retailers as we move into 2026. Many will still have significant volumes of leftover stock but if they discount too heavily, they risk destroying their already squeezed margins."
Total retail sales across discretionary categories fell 1.4% in December year‑on‑year, the weakest monthly performance since November 2024. In‑store sales declined 0.5% and online sales 0.6% as volumes fell across channels. October and November recorded below‑inflation figures, leaving the Golden Quarter significantly down year‑on‑year. Persistent food inflation and high living costs led consumers to cut discretionary product purchases, prioritizing festive food, drinks and experiences. A late Budget added economic uncertainty and weakened consumer confidence. Retailers face leftover stock, squeezed margins if heavy discounting occurs, pressured balance sheets, and reduced capacity to invest in new product lines into 2026.
Read at London Business News | Londonlovesbusiness.com
Unable to calculate read time
Collection
[
|
...
]