UK retailers suffer sharp slowdown in sales, says CBI

Retail sales ground to a halt at the start of October – coming in well below City forecasts

Retailers suffered a sharp slowdown in sales this month, according to an industry survey that has cast doubt on the pace of the wider UK economic recovery.

After a strong run of growth, sales ground to a halt at the start of October and came in well below City forecasts, the CBI business group said.

The main sales balance in its monthly survey came in at +2, down sharply from +34 recorded in September and much lower than +33 forecast by economists in a Reuters poll.

The balance, which is the difference between the percentage of retailers reporting an increase and those reporting a decrease in sales, was the weakest since June and breaks a three-month run of strong sales growth.

Some economists said the slowdown underlined the pressures on households as lacklustre pay growth fails to match rises in living costs. If consumer demand remains weak, economic growth in the final three months of the year may fail to match the 0.8% reported for the third quarter in official figures last week.

But the CBI and other analysts said there were signs sales would soon bounce back. In particular, the business group emphasised that a majority of retailers were placing bigger orders with their suppliers.

Barry Williams, from Asda and chair of the CBI's survey panel, said: "Although the high street recovery stalled this month, there is optimism that it was just a blip on the previous run of three months' growth. Retailers expect sales to pick up next month."

For October, most sub-sectors saw sales growth slow, the CBI said. In particular, grocers saw the first year-on-year fall in sales volumes in eight months but there were some areas that enjoyed stronger trade.

"Signs are pointing towards increased consumer confidence – backed up by continuing growth in certain areas such as furniture and carpets; recreational goods; footwear and leather – all did particularly well in October," added Williams.

James Knightley, economist at ING Financial Markets suggested the surprise collapse in this month's sales balance was weather related.

"October has been far warmer than usual and as such demand for autumn/winter clothing has been very weak. As temperatures drop we should see demand for these items strengthen. In any case consumer confidence continues to strengthen while the pickup in the housing market appears to be supporting furniture and carpet sales," he said.

Howard Archer, an economist at IHS Global Insight, said the survey underlined the pressure on consumers, who are "taking at least a temporary breather".

"The survey fuels suspicion that GDP growth is likely to moderate in the fourth quarter from the robust 0.8% quarter-on-quarter expansion seen in the third quarter.

"With purchasing power currently being limited by consumer price inflation running well above earnings growth, it is likely that many people are feeling the need to rein in their spending at least temporarily, particularly if they want to build up their funds for spending over the Christmas period."

Article Source : http://www.guardian.co.uk
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Strong carpet and furniture sales boost UK retailers, CBI says

Shops and stores had a better September than expected as the recovering property market affected rest of economy

Sales of furniture and carpets are rising strongly as the impact of Britain's recovering housing market affects the rest of the economy, the CBI has said.

The latest snapshot of retailing from the employers' organisation showed that shops and stores had a better September than anticipated and expect the improved trading environment to continue into October.

The pickup in activity was led by the furniture and carpets sector, where for the first time since 1996 every one of the retailers questioned by the CBI said sales were higher in September than a year earlier.

But the monthly distributive trades survey found that the pickup was broad based, with grocers and retailers selling recreational goods also reporting strong growth in sales volumes.

Overall, 46% of the 111 firms questioned said business was better than in September 2012 while 12% said it was worse. The balance of +34% was the highest since June 2012 and was accompanied by retailers placing more orders with suppliers.

Barry Williams, Asda's chief merchandising officer for food and chairman of the CBI distributive trades survey panel, said: "It's encouraging to see the high street on the road to recovery, with particularly strong growth from furniture and carpet retailers, department stores and recreational goods retailers.

"But the retail sector is not out of the woods yet with consumer confidence still fragile despite the rise in spending."

The CBI reported that 22% of retailers said sales volumes were above average for the time of year, while 10% said they were below average. The balance of +12 points was the highest since December 2010.

David Tinsley, economist at BNP Paribas, said: "The most obvious caveat to reading too much into this survey is that the relatively good result in August was not reflected in the official retail sales data for that month, which fell 1%. Still, the broad momentum of sales appears firm and upwards. And the CBI survey suggests this remains the case."

Richard Lowe, the head of retail and wholesale at Barclays, said: "Retail sales have grown for the third month running, and these strong figures will no doubt provide a fillip for the high street.

"Retailers will now be hoping for more seasonal weather to help sales of new autumn/winter collections and for consumer confidence to tick up as we head towards the crucial Christmas trading period".

Article Source : http://www.guardian.co.uk

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UK retail sales in unexpected fall

ONS data shows volume of retail sales dropped 0.9% in August – mainly due to weaker demand for food

Britain's consumers took a break from shopping last month as spending fell back from the high levels recorded in July.

Data from the Office for National Statistics showed that the volume of retail sales dropped by 0.9% in August – mainly as the result of weaker demand for food.

The ONS said supermarkets had been particularly busy in July during the hottest of the summer weather but that activity came back to more normal levels in August.

After the recent run of strong economic news, the City had been expecting retail sales to grow by 0.4% between July and August, and the pound fell when the figures were released.

Food sales dropped 2.7% in August, and there was little evidence of the recent pickup in housing activity helping sales of household goods, which fell by 1.6%.

Over the three months to August – considered a better guide to the trend than one month's figures – retail sales were up by 1.7%.

Annual growth – comparing the latest quarter with the same three months in 2012 – stood at 2.3%, the ONS said.

The official figures also indicate Britain's increasing love of online shopping. The ONS said non-store retailing sales grew by 29% between August 2012 and August 2013 and that there had been a marked upward trend since the turn of the year.

"Since January 2013, the non-store retailing sector has seen continued year-on-year growth in both the amount spent and bought in this sector."

James Knightley, an economist at ING, said: "It is a disappointing outcome that has taken the wind out of the sails of sterling for now, but the underlying story still looks good with the three month on month total sales growth still up 1.7%, consumer confidence rising, employment increasing and credit availability improving."

Article Source : http://www.guardian.co.uk

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UK retail sales slump as shoppers balk at higher prices and cold weather

ONS said food shops were the worst affected as retailers reported a 1.3% decline in the amount of goods sold

Retail sales slumped in April after shoppers balked at rising prices and were reluctant to venture out to the high street in one of the coldest springs on record.

The Office for National Statistics said retailers reported a 1.3% decline in the amount of goods sold, with food shops the worst affected. Sales of food plunged 4.1% on the month, the weakest showing in almost two years. Shops also suffered a 0.2% contraction in the amount of money spent on the same month a year ago, which was the biggest year-on-year fall in retail spending since the turn of the century.

The cold weather was the biggest factor as the sale of barbecue food, garden furniture and summer dresses was put on hold. April was also a terrible month for garden centres following the big chill that effectively delayed spring by a month.

Cold weather was the biggest factor as the sale of barbecue food, garden furniture and summer dresses was put on hold

Several major stores have announced a significant bounce back in May, with garden centre sales reportedly up 70% in the first three months of the year, but the overall contraction, and especially the deterrent of rising food inflation, will concern the Treasury.

Ministers are hopeful of a bounce back in consumer confidence during 2013 to increase high-street sales and boost economic growth.

The ONS said consumer prices data showed that food prices had steadily been increasing and that a wide variety of food types contributed to the rise, including staple goods.

"This rise in prices will have squeezed consumers' disposable income, possibly resulting in them buying less or substituting cheaper goods for their normal purchases," it said.

Chris Williamson, chief economist at financial data provider Markit, said the weather-related drop in sales was a reminder that the economy remains in a fragile state.

"It is likely that spending will revive again in coming months, helping keep the country out of another downturn, though recovery will be only gradual as incomes continue to be squeezed," he said.

He pointed out that the underlying picture was more likely one of modest growth of sales following a 0.7% rise in the latest three months sales on the previous three-month period, which was the strongest rate of increase since last September.

"Households' views on their finances are the brightest for three years, according to Markit's household finance index for May. Being busier at work, rising house prices, news of the country having avoided another recession and buoyant equity markets have all helped generate more of a 'feel-good factor'."

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Article source : http://www.guardian.co.uk

Aon defers bonus payments to avoid 50% income tax

The London-based insurance broker Aon is helping 250 of its remarkably paid personnel prevent 50% tax by just deferring incentive payments prior to the newtax 12 months.
Some of the best broker agents, such as Willis, is likewise thinking of if you should allow his or her workers for you to put rear repayment schedules until eventually right after Six to eight Your planting season when the leading demand of revenue fees declines as a way to 45%.
Merely days and nights when the investment bank Goldman Sachs ended up being required to back unattended plans to delay sign up bonus deals, it can be surfaced that Aon has set elements setup to obstruct payments for its employees in order that they spend taxation using 45%. The actual shift permits an executive thinking about any £200,000 payout to save £10,500 inside duty.

Goldman's U-turn appeared immediately after decision from the Standard bank connected with Englandgovernor, Friend Mervyn Grasp, together with force through people in politics. That they told the Treasury pick cell: "I believe that it is just a little demoralizing that folks who are generating much appear to contemplate it happens to be additional fascinating as a way to sort of adjust your right time to of computer to find the plus side to a lower taxes price that they will find a way to benefit coming from in the end with a fairly great extent.In .

Aon and other firms risk damaging their reputations by deferring bonus payments to staff, says the Bank of England governor, Sir Mervyn King

Goldman following reported it turned out will no longer contemplating if it need to delay payments on perks originating from Last year, 2010 and The new year, that happen to be on account of grow to be offered to be able to personnel in the arriving several weeks, before the prime price tag decrease.
Quite a few Place organizations making use of workers that will spend on your leading value connected with fees can contemplate should you wait obligations to the new duty yr however specialists feel many produced our mind upwards towards this kind of move carrying out a remove in the deficiency of levy paid for through java line Favourite coffee shop in great britain.

Aon is among many important insurance providers to be able to media ahead of time as well as deferring incentive responsibilities even though Willis said it was still considering whether to do furthermore. "Willis will need this disorder seriously and we're critiquing that,Inch pointed out any kind of representative to your insurer, which employs around 3,000 staff in britain.
The actual Aon sign up signup bonuses overlap using your current Buy budgetary Yr along with ended up due to get paid inside Generate. They will end up being taken care of within '04 following the start of the brand-new impose calendar year.
A whole new representative spelled out: "Qualifying Uk employees acquired either deferring settlement with the The coming year register signup bonuses through Generate that you should The actual planting season 2013. Roughly Two hundred and fifty workers, 4% from the United kingdom worker foundation, decided on this strategy.Throughout .

Aon, which experts claim results in your current Person utd little league class tee shirts, possesses many firms inside the united kingdom including insurance company Benfield in addition to Human resources specialists Hewitt. This particular moved it is hq through Chicago, in order to Greater london recently in order that it may be more detailed your Lloyd's of London insurance plan market place.
The particular shift relating to Aon's Hq brought on predictions of countless lbs of more income for your exchequer so the latest shift may possibly show to be a great being made fun of to the chancellor, Henry Osborne, whom got turned down for you to widely criticise Goldman around levy.
Just about any treasury reverend, Sajid Javid, though, talked as a way to very best representatives for the traditional bank right after King's feedback in order to MPs.
The lending company concerning Britain governor knowledgeable the specific panel: "It would be rather ungainly and rather lacking in care and attention for you to how others may possibly react … eventually, banking companies, like all huge businesses, depend on excellent will surely from your all modern society, they cannot merely are available on their own.In .
Jesse Cameron skilled criticised the specific income taxes extramarital affairs from the witty Jimmy Carr widely throughout June though the govt was slower as a way to lambast corporations with this group strategy.
The specific coalition characteristics mindful before calendar year that is would certainly reduce the 50% leading value regarding tax levy unplaned by means of Perform in which got into influence this coming year.

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140 UK retailers in 'critical condition'

Business recovery firm reports 35% rise in number of high street stores experiencing significant distress before Christmas

140 high street retailers are on a 'critical watchlist'. The health of the sector is key to employment data and consumer confidence

More than 100retailers are in a vital condition and will probably stick to HMV and Jessops into government, among the United kingdom's leading organization recuperation companies offers informed.
Jules Palmer, a partner in Begbies Traynor, mentioned 160 retailers ended up on the business's "critical watchlist" -- looked as companies that had obtained whether finding yourself application or even a local court wisdom versus these people over £5,000.
Your woman included that the business's newest analysis additionally featured there were a 35% surge in the quantity of merchants experiencing important stress ahead of Christmas time, which means Thirteen,Seven-hundred store owners either experienced any maintained amount of failing finances as well as have been within receipt of your region court wisdom regarding less than £5,Thousand.

Palmer dropped to recognize the A hundred and forty beneath fast danger, yet said we were holding a variety of well-known names and also smaller sized stores. "Experiences educates people that a substantial percentage [on the actual critical list] can fall into some kind of financial distress process,Inches the girl mentioned.
The healthiness of the high street is vital for you to job data as well as buyer self-confidence. With many Three million people working in britain list market, it does not take biggest personal field workplace.

Palmer explained: "Overall, your sectors which are many vulnerable incorporate individuals impacted by customers transferring in order to on the internet as well as electronic types, including professionals within music, game titles, textbooks, news and stationary combined with professionals which might be nearly all suffering from the particular as well as price-driven offering with the supermarkets, such as apothecaries, health and beauty, and also alcoholic beverages suppliers."
The particular dismal perspective to the industry came up as the tunes chain HMV implemented camera-supplier Jessops straight into management following lengthy struggles by simply equally firms to be able to come across enterprise versions that could contend with online retailers.
The down sides are already reflected anywhere else on the high street, in which stores for example JJB Sports activities and Comet get folded away in the latest thirty day period.
Stats manufactured by RSM Tenon book-keeping group reveal that next year regarding 1,300 suppliers started to be bankrupt, that means they couldn't pay out their debts - an upturn regarding 7% in This year. Joe Ratten, your business go involving restructuring, explained: "We count on in 2010 to be a whole lot worse, while those who have been able to teeter about the border for the past few years may notice the complete results of the decrease in optional shelling out, intense levels of competition and lowering cash supplies.

"We believe 12,679 merchants have a great probability of insolvency away from greater than One hundred,Thousand retailers country wide." The telephone number from dangerous, he said, was 40% high on 12 This year.
Michael Ingram, a niche analyst using City broker BGC, said: "UK retail store issues never finish there. Throw away cash flow in england continues to be compressed mercilessly: wage growth is actually working at less than half the rate associated with the cost of living (1.3% versus Two.7% for the client value catalog and three.0% for the list price index), while the cost of living throughout non-discretionary products, like energy and also normal water contract deals, can be running in excess of 6%.

"To leading everything, consumer credit features, from finest, flatlined over the past few months. One method or another, consumers in britain have less money to invest and they are significantly circumspect of the way they will invest precisely what stays. [For a few retailers] the net has had unwelcome visibility to be able to top quality prices.Inch
Your decline has still left a lot of higher pavement despondent, while using British Retail store Range (BRC) estimating that particular in seven city center stores will be empty, the very best degree since the buy and sell system started out producing info, inside July This year.
Nevertheless, the particular BRC additionally just lately produced much more upbeat info. Its employment check, addressing June for you to October This year, confirmed the amount of list jobs increased simply by 2.9% weighed against a year earlier, although benefits ended up inside the food sector; jobs made in non-food retailers fell.

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