High street sales down, says report

High street sales dropped by 2.2% last month in an "underwhelming" Christmas for many retailers, according to a report.

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High street sales fell by 2.2% in December, according to a report from accountancy firm BDO

High street sales dropped by 2.2% last month in an "underwhelming" Christmas for many retailers, according to a report.

Figures from accountancy firm BDO showed the sales surge hoped for by many shops failed to materialise in the crucial trading period, with like-for-like sales - excluding online trade - dropping by as much as 6.7% in the week to December 22.

Even a 3.5% surge in the week to December 29 failed to boost the overall performance for the month which was down 2.2% on December 2012.

December 2012 had seen a 1.9% rise compared with the same month in 2011.

BDO said: "Following on from what was a solid month of trading in November, many retailers will have been left disappointed by a month of lacklustre consumer demand in the crucial Christmas trading period."

" Pent-up demand was expected to play a larger role as we moved closer to Christmas day but in reality it never fully took hold," it added.

Bad weather amid the pre-Christmas storms hit trading for many, with fashion sales in particular suffering, down 4.6% last month.

But the data showed another stellar Christmas for online sales, with non-store sales leaping 31.1%, rising to growth of 55.7% in the week before Christmas.

Figures so far from major retailers have confirmed it was a mixed Christmas.

Debenhams issued a shock profit warning last week after suffering dismal trading and resorting to aggressive discounting, while figures showed robust performances from fashion chain Next and department store rivals John Lewis and House of Fraser.

Marks & Spencer, which also slashed prices in the run up to Christmas, is expected to reveal the results of a tough season for the group when it reports on Thursday.

Data yesterday from Barclaycard highlighted a marked trend for shoppers to target discount days for the best deals, with the value of transactions falling by 3.5% last month as shops cut prices to lure in consumers.

BDO's figures, which track sales across 85 mid-tier retailers with around 10,000 stores, showed while it was a n "underwhelming Christmas for most", there were robust performances for some.

Homewares saw an increase of 8% year-on-year as consumers prepared their homes for entertaining over the festive period , although this was flattered slightly by weak like-for-like figures in 2012.

Don Williams, national head of retail and wholesale at BDO, cautioned that this month could also be difficult for retailers.

"January is a cruel month for the high street as retailers are usually sitting on high cash holdings and low stock levels, so they are particularly exposed at this time of year," he said.

Closely watched sales figures from the British Retail Consortium are due on Friday, which will also shed further light on how the sector performed over Christmas.