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Retail sector sees sixth month of growth

Thursday, June 26th, 2014

Retail sales saw an increase for sixth month running in May, according to new data from the CBI’s quarterly distributive trades. While the figures were lower than last month due to Easter spending in April, experts say the overall sales figures are still positive and represent healthy economy growth.

Overall, 38 per cent of retailers saw an increase in sales, while 22 per cent saw a fall. This gives an overall net positive percentage of 16, which is lower than the 30 per cent in April, but still a sign of the British economy picking up. The report also found that 29 per cent more retailers were expecting a growth in sales next month.

Retail is seeing a real trend in positive reports lately; the Office for National Statistics recently revealed that the sector had enjoyed its fastest-growing pace in over a decade, while the recovery of the housing crisis has encouraged a boost in home and decorating retail.

Howard Archer, chief UK and European economist at IHS Global Insight, commented: “The fundamentals for consumers are currently improving overall, and they should continue to do so over the coming months as employment continues to rise and earnings growth likely trends higher than inflation.”

However, Paul Hollingsworth, assistant economist at Capital Economics, was quick to mention that statistics also showed a slowing down, stating: “This suggests that retail spending may slow from its recent robust rates of growth. Indeed, we had already begun to doubt that retail sales growth could maintain its recent strength, given that real pay is still struggling to rise on a sustained basis.”

Consumer confidence at UK record high

Sunday, June 8th, 2014

Consumer confidence is at an all-time high in the UK, according to recent data from the European Commission’s Economic Sentiment Index released on May 28th. The report found that confidence is rising most rapidly among young people and workers in full-time employment – although even for those who are self-employed or working part-time, confidence is at its highest since 1998.

It’s also the first time in 16 years that a positive net balance of respondents expect unemployment to decrease over the coming year, and overall the number of people who feel the economy is improving has risen. Among young people, confidence is at its highest ever, while results for the 30-64 age groups are also the highest since 1998.

The results come at the same time as reports from the Confederation of Business Industry, which found that retail sales in the UK were continuing to grow, albeit slowly, with furniture and home improvement sector claiming one of the strongest retail performances in the UK. Despite a difficult start, retailers are expecting sales to increase further over the next quarter.

“At +7.6 in May, the European Commission’s consumer confidence index is at its highest level since the series started in 1985 and substantially above its long-term average of -9.7,” Howard Archer, chief UK and European economist at IHS Global Insight, commented, adding: “News that consumer confidence has extended its upward trend to a new long-term high in May bodes well for consumer spending in the near term at least. Confidence is being boosted by generally improving purchasing power, increased job security and generally more upbeat views of the economy.”

Retail sales on the rise

Friday, May 30th, 2014

Retails sales have seen a boost according to the Office for National Statistics, who reposted that retail sales volumes were 0.1% higher in March than they were in February of this year. The figures also showed that there was a particular rise in sales of clothing and footwear.

This beats sales forecasts, which expected a drop due to the Easter bank holiday falling in April this year. However, volumes were up by 4.2% when compared year-on-year, which the ONS attributes to cold weather dampening sales in 2013.

Non-food stores had the biggest year-on-year rise for 12 years, going up by 9.6%.

In addition to this, sales for the first quarter of the year were up by 3.8%, compared to last year, adding to the pleasing news that the economy is strengthening.

This comes after the news that the Bank of England has raised its growth forecast for the quarter from 0.9% to 1%.

Sales of clothing increased by 3.1% in March, up from February, which helped boost the overall average sales up into the slight 0.1% increase.

Chief Economist at research firm Markit, Chris Williamson predicted that the sales growth was not temporary, saying “There is a fundamental improvement in household finances underway which should help drive further ongoing growth of consumer spending as we move through the year.”

He also added that the improving job market and rising wages combined with lower inflation helped to boost consumer spending.

New retail jobs on the increase after a boost in confidence

Wednesday, May 14th, 2014

The first quarter of 2014 has seen a boost in retail jobs, with the number of full-time equivalent jobs rising by 1.8% in the first quarter of 2014, compared with the same period last year.

In figures released by the British Retail Consortium and Bond Dickinson, it showed that the rise in new jobs were mainly driven by the non-food sector as a result of improvements in confidence.

The figures also revealed that full-time hours outgrew that of part-time hours, confirming the rising confidence in the retail sector.

The number of new retail outlets also grew by 1.3% in the first quarter of 2014, with food retailers leading the way in new shops.

Director General for the British Retail Consortium, Helen Dickinson said that retail’s contribution to the economy was underlined by the growth in new jobs, adding, “As the UK’s largest private employer, it’s particularly heartening to see increases across all types of role, including full-time hires. This demonstrates increasing confidence.”

Head of Retailer Employment at Bond Dickinson, Christina Tolvas-Vincent said that the numbers were a departure from recent years as non-food retailers have driven the increase in full time jobs, something usually attributed to supermarkets and other shops in the food sector.

However, she pointed out, “The only blot on the buoyant landscape appears to be a fall in hours worked amongst food retailers, despite a growth in store numbers. An increasing trend of smaller stores would support this but it will be interesting to see how these figures play out in the extremely competitive world of food retail.”

Sales on up by 62 percent

Wednesday, April 30th, 2014

Online fashion retailer has announced annual sales are up by 62 percent on last year after recently floating on the stock market.

Earnings before interest, taxes, depreciation and amortisation for the company increased by over 200 percent, reaching revenues of £109 million in the year end to February. After this announcement, shares in the company rose 2 percent to 52p, valuing the company at £600 million.

However, is currently trading on 50 times its estimated annual earnings, but co-chief executive Mahmud Kamani remains positive, saying it reflects the potential in the company: “I don’t know anything about a bubble, I know about Boohoo. The valuation is set by the market and the investors. We need to invest in our business.”

The company sells own-brand clothing for men and women, and its biggest rival is Asos, who has recently issued a profits warning. It’s based in Manchester and was originally founded by Kamani and his business partner Carol Kane back in 2006.

Research company Oriel commented on‘s trading update, saying that it highlights the company’s ability to turn revenue growth into profits. Alistair Davies from Oriel said: “The growth prospects for the business look strong in both the UK and internationally as the business invests in increased levels of marketing. Whilst no comment has been made on current trading, we estimate that the group’s exit growth rate is in excess of 30pc.”