Retail sales decelerated in February, CBI finds

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24th February 2015 12:37 - Retail

At the end of January, figures from Confederation of British Industry’s (CBI) business survey showed that sales volumes within supermarkets Retail sales decelerated in February, CBI findsand department stores, are decreasing at a rapid rate.

According to the survey, retailers in the UK are facing a period of deceleration, as sales have barely increased from a year ago. The figures are a stark contrast from the high expectations of retailers and city economists, prior to the release of CBI's figures.

The business survey showed that retailers are actively adopting methods to attract more customers, such as sales and discounts, during a period when conversion rates are dropping.

In the survey of 62 retailers, 30 per cent claimed that their sales were higher than that of the year ago. On the other hand, 29 per cent reported a fall in sales. From these responses, a balance of +1 per cent was given, the lowest since November 2013, and much lower than the +42 per cent retailers were expecting.

Prior to the Confederation of British Industry’s survey, Reuters had predicted that sales growth in the UK would slow, albeit only slightly, with a balance of +39 in January and +34 in February.

The report from the Confederation of British Industry indicated that the months ahead may be difficult for trading, due to suppliers receiving a falling number of orders this month (February), the scaling back of investment plans and expected staff cuts.

Despite this, the Confederation of British Industry claims that businesses are remaining confident that sales will grow in March, with 44 per cent of retailers anticipating growth next month. However, 17 per cent are expecting a fall in sales next month, giving a balance of +27 per cent. The report noted that the expectations are not as high as in recent years.

The Confederation of British Industry claimed that a few sub-sectors, such as chemists, highlighted a rise in sales.  Nonetheless, fashion retailers, grocers and non-specialised retailers experienced a fall in sales volume.

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