Fraught final Christmas trading period sees retailers on the edge of their seats

Despite the reams of available data and forecasts for 2015’s final trading period, retailers were on the edge of their seats in the final week of retail sales, following mounting uncertainty over the crucial Christmas trading period.

The much-hyped Black Friday turned out to be a bit of a damp squib here in the UK and other unexpected factors, including the Paris terror attacks and milder weather combined to create what retailers described as a ‘slower build up’ to the final week of Christmas sales.

The period usually known as the ‘golden quarter’ saw analysts expressing grave concerns over the level of uncertainty for this phase, following such challenging market conditions.

Clive Black, analyst at Shore Capital told Retail Week that he awaited the January updates “with increasing nervousness surrounding the robustness of earnings forecasts for the non-food retailers”.

But some retailers remained optimistic that there would be a last-minute spending dash in the run up to Christmas, partially fuelled by the fact that it fell on a Friday this year.

Speaking to Retail Week, Black agreed that it would be a “very late and very large” Christmas. He predicted that overall sales would be higher than last year and that the pre-Christmas four-day trading week would be “massive” for both food and non-food retailers. However this late spike would not be good for stores as they would need to employ extra staff to cope with the queues and frantic last minute spending, rather than watching sales build slowly and calmly, over the course of several weeks.

Many retailers noted that shoppers seem to be leaving it later than ever to make their purchases, in the hope of securing cut-price deals. The Centre for Retail Research predicted that there would be a six-day £6bn spending spree in the run-up to Christmas, calling the Saturday before Christmas ‘Panic Saturday’ with 12.6 million shoppers expected to hit the high street in a rush for food and gifts.

Gary Grant, boss at toy retailer ‘The Entertainer’ suggested that like-for-like sales had fallen in the past two months and that consumer confidence appeared to have “drained” following the Paris terrorist attacks in November.

Black Friday has not helped analysts and forecasters in their bid to predict Christmas sales figures and appears to affect consumer behaviour as they hold out for bargains, as Grant suggested:

“Black Friday has become a distraction and it’s been a slower build this year, but I think we are going to finish really well.”

As always on the blog we’ll let you know when the figures are in – and what 2016 holds for the different retail sectors as we head into a new period of financial uncertainty.