Good Christmas and Sales Period but tough 2010?

Retailers are facing a “very tough” 2010, despite posting upbeat Christmas sales figures, the head of the British Retail Consortium (BRC) has warned.

BRC director general Stephen Robertson said consumer spending may not grow in the face of tax rises and continuing economic uncertainty.

“There will be tough sales and perhaps no growth,” he said in an interview with the Sunday Telegraph.

Most of the major retailers, whilst reporting generally good Christmas sales, have stated that they expect 2010 to be  tough/difficult/challenging.

It would have been a surprise if retailer sales for the Christmas and Sale period were not up against last year, given the disappointing sales of 2008, the rush to beat the VAT increase and fewer retailers on the high street with loss of Woolworths, Zavvi, Borders and a host of furniture groups.

Another reason given is that consumers have been re-directing some of their disposable income to the High Street with their lower mortgages, cutting back on holidays and not moving home. Should interest rates start to move then this may be reversed and missing out on holidays in 2009 will make them more of a priority for 2010.

For sure, this is going to be a long hard climb to get back to the halcyon days of 2007 and many retailers see the only growth is through increasing market share. i.e at the expence of other retailers.

Another year beckons where you cannot rest on your laurels. It’s going to be tough but those that survive will reap the rewards in future years.

So, as ever, watch those costs and overheads, keep your stock levels tight working to shorter lead times where possible and negotiate hard!

Good Luck

Tony Heywood – Gilcrest Services Ltd
Retail Troubleshooter
Business Turnaround and Recovery

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