British High Streets Given Boost as Sales Jump

24th May 2018.

Retailers enjoyed the biggest jump in sales in 18 months during April as shoppers, forced to stay home by the bitter weather in March, returned to the high street.

It’s been a hard time for retailers, amongst battling low profits and surviving the so-called apocalypse. British high streets have been emptying at an alarming pace, with low consumer confidence and slow spending pushing retailers into insolvency and voluntary agreements. Now that inflation has fallen once again, and Brexit uncertainty is slowly easing, retailers have reported an unexpected jump in sales.

According to new data from the Office for National Statistics (ONS), sales volumes were pushed up by 1.6 percent in April, compared to the previous month. Above all things, the sun finally came out, creating a welcome contrast with the difficult cold weather from the month before.

This is not to suggest a broad economic shift, and the ONS still urges that sales growth remains “subdued” with doubts levelled on the longevity of the positive levels. At the Credit Protection Association, business owners have approached us when low profits and slow sales growth have started to weigh down their business. While the economic stability of the high street remains so unpredictable, it would be wise for all business owner to pursue third-party assistance.

A spokesman for ONS said: “Over the longer-term retail sales growth has slowed considerably, with increases in food, household goods and internet retailers being largely offset by declines across all other types of retailing.”

A number of retails are struggling, with Marks & Spencer saying earlier this week it would be closing 100 stores by 2022.

Andrew Westbrook, head of retail at accountancy firm RSM, said: “Retail sales were slightly better than expected in April giving operators a chance to partially recover from the poor weather in March.

“The amount spent by shoppers increased by 3.5% when compared with the same month last year. However, while these numbers are encouraging, there is still a Darwinian struggle taking place on the UK high street.

Howard Archer, chief economic advisor to the EY Item Club, said there were good reasons to remain downbeat about the prospects for retailers. He said: “With inflation moderating and regular earnings growth firming gradually the squeeze on consumers has eased. Nevertheless, consumers are still under significant pressure and it looks unrealistic to expect a marked upturn in consumer spending any time soon.”

 Inflation has fallen and interest rates look likely to remain unchanged, and as a result, retailers could see their financial position shift. While the recent sales jump is unlikely to persist in the long-term, business owners can encourage stronger profits by refocusing on cash flow.
It is no longer enough to merely demand extra cash. While many retailers would indeed benefit from extra cash it is the overall strength of their finances which will propel them forward. At the Credit Protection Association, while we do collect on debt and provide our members with more financial stability, it is our credit checks and company directories that make our members a success in their field. We advise our members on how to harness new financial freedom, either exploring expansion opportunities or creating a supportive savings regime. At CPA, we are more than a debt collection and credit management company; we are both.

The Credit Protection Association is a credit management company established in 1914. If you supply goods or services on credit then we can help you!

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