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Retail sales up in December
UK retail sales volumes were up 0.6 per cent between November and December, according to official figures.
The Office for National Statistics (ONS) also revealed that annual sales were 2.6 per cent higher than in December 2010 after many high street stores slashed prices during the run-up to Christmas.
A statement from the ONS said that sales volumes were largely driven by clothing and footwear sales, which increased by 1.8 per cent compared with a year ago.
However, the British Retail Consortium (BRC) said that sales were made at the expense of margins.
BRC public affairs director, Jane Bevis, said, "As our own figures showed, December did provide a small boost for the retail sector.
“After a difficult year some shoppers relaxed their tight hold on their finances and allowed themselves to splash out on gifts and festive food and drink, aided by deep discounting.
“Others had cut back on spending in previous months and saved up for the season."
She explained the figures are being compared to the “poor, snow-hit” December of the previous year.
The fundamental conditions which are making business difficult for retailers, Bevis added, have not altered.
“Underlying factors including low consumer confidence and falls in real disposable income mean shoppers remain reluctant to spend and are only encouraged by significant discounting.
“Retailers are competing hard on price and their margins are feeling the effects. For some, these difficult trading conditions have led to business failure.
“Retailers will be braced for a couple of slow months and the danger is that the eye-watering business rates rise of 5.6 per cent, due to come into effect in April, will push more high street businesses over the edge,” she concluded.
