QSM Q4 2019 – Christmas trading down for most
Sales were up for Books & Toys, Music, Computer & Telecoms and Health Store retailers between October and December 2019, but all other sectors have seen a drop.
The overall picture from Bira’s exclusive Quarterly Sales Monitor (QSM) for the fourth quarter of 2019 is one of disappointment, with the vast majority of the figures showing a decline when compared to the previous quarter and Q4 2018. Only two out of the twelve sectors surveyed reported a positive performance during the quarter, with five out of twelve showing a decline when compared to Q4 2018. Overall, only 39.57% of respondents reported a higher performance for Q4, which is down significantly from Q3 2019 (42.33%%) and Q4 2018 (46.34%). The overall performance average for the quarter shows a fall of -2.82% for retailers, compared to the same period last year.
Sales of books, toys, music, computers and telecoms products were higher for the fourth quarter of the year, with the sector seeing a +3.16% higher performance against Q4 last year. This represents a big improvement for the sector on Q3 (+1.42%) and Q4 2018 (-3.13%). Health store retailers had a strong quarter, reporting an overall average performance of +2.75%, which is up on Q3 (-0.59%) and Q4 2018 (+0.18%).
The worst performing sector in the QSM was Café & Eateries which was -14.3% down. Other struggling sectors include clothing and footwear retailers who were down -4.80% at the end of the year. This marks a stark decline from the start of 2019 to the end, as the sector started off the year with a performance of +0.33% in Q1. Cards, stationery, crafts and hobbies retailers also struggled this quarter with an average performance of -4.64%.
Wales was the best performing region with retailers reporting a performance of +2.88%. This represents a great recovery for the area as retailers in the region reported a performance of -1.79% in Q3 2019. Retailers in Northern Ireland were the only other region to report on a positive quarter with an average performance of +0.46%. Generally, it has been a disappointing quarter overall for the remaining regions with all reporting a decline in sales.
It is clear from the analysis, supported by the member comments that the General Election in December hampered trading at the busiest time of the year for retailers as the 39.57% higher performance value is the lowest figure on record across our QSMs. 61.74% of respondents are facing modest margin pressures, due to a weaker Pound as a result of Brexit. However, anxiousness for the year ahead has dropped slightly to 48.70%, perhaps aided by a secured Brexit deal and the announcement of a majority Government.
Andrew Goodacre, Bira’s CEO said: “The figures from the final QSM of 2019 reflect a difficult quarter for independent retail businesses at the busiest time of the year. Although 2019 started in a more positive manner, only 39.57% have reported a positive performance. Furthermore, to see an overall drop of 2.82% is worrying and reflective of the challenging times retailers are facing.
We predicted last quarter that an election before Christmas would impact businesses and this has clearly been the case. To have more political instability just before the festive season hampered consumer confidence and subsequently hurt businesses.
However, with a majority Government in place I believe we can look forward to the year with some optimism. Following our campaigning over the last three years, we were delighted to see the Government increase the rates discount from 30% to 50% for smaller retailers. We are now calling on them to make this increase permanent as it was set to run until 2021.
We also want more from the new Government in terms of incentives for investment into a business, easier rates appeals, better parking facilities for shoppers and much more. We want to retain a thriving high street and 2020 will be an ideal opportunity for the ‘powers that be’ to truly level the playing field.
As always, Bira will continue to fight for a better deal for independent businesses across the UK.”