Fashion had its worst July in eight years with sales slumping by -3.5% despite the onset of the Sale season, according the the latest figures released by BDO.
The accountancy and business advisory service said the poor performance from fashion had dragged overall high street sales into negative territory at -0.6%, in its monthly High Street Sales Tracker.
Head of retail and wholesale at BDO Sophie Michael said the figures demonstrated a clear move from customers to tighten their belts. “While June’s sunshine demonstrated that the sun can whet consumer appetite for shopping, poor weather at the end of July combined with consumers starting to feel the pinch took its toll on fashion last month,” she said.
“It is apparent that shoppers are diverting their attention to essentials and tightening their belts. The concern here is that sales have diminished in a typical month for discounting, when retailers traditionally look to clear stock to make room for new ranges. The results imply that the road ahead may be even more challenging than expected,” Michael added.
The results were backed up by a trading update from bellwether retailer Next yesterday which confirmed that it had shifted less stock during its end of season Sale. Reporting a drop in Q2 full price sales of -1.2% the retailer said it had performed well when the weather was warm but it had gone into its end of season sale in July with -5% less stock and markdown sales were down by -14%.
Michael said that for the forthcoming AW season it was important for retailers “to focus heavily on how they present their collections and engage with their customers to entice them to spend amongst fears of further falls in disposable income and the risks of rising consumer borrowing.”
However it wasn’t all bad news on the high street, despite the “shock casualty” of fashion, homewares sales were up 5.8% and lifestyle sales (boosted by tourist spend) were up 4.5%.