January retail sales rise as shoppers grab a bargain

The January sales lured bargain hunters back to the High Street in January, according to figures released by accountancy and business advisory firm BDO.

The BDO’s monthly High Street Sales Tracker saw 1.4% growth in year-on-year sales last month, with fashion sales particularly strong, up 1.9%.

Meanwhile, the lifestyle sector saw sales rise 0.3%, while homeware sales increased 0.8% and non-store sales grew 20.2% compared to the same period a year ago.

The figures are likely to provide some comfort to retailers, after December’s data revealed the worst Christmas trading on the high street since 2008.

Fashion sales were up over 5% year-on-year in the first two weeks of the month as shoppers continued to spend beyond the first week of January, something that failed to materialise last year.

However, LFL sales moved back into negative territory once the sales period ended, the BDO said.

Sophie Michael, head of Retail and Wholesale at BDO, said retailers would be feeling better after the disastrous December, but cautioned that shoppers still had “a bargain mentality”.

“The lull between Black Friday and the January sales was particularly noticeable at the end of 2015 and beginning of 2016,” she said.

“Retailers might be getting better at attracting the new generation of savvier shoppers in discounting periods, but margins will suffer unless they sell full-price stock too.

“The strong retail performers demonstrate that consumers are willing to pay full price if they see a desirable product. The stores that will thrive in 2016 will be the ones who combine a strong customer service proposition with an attractive brand and a compelling product mix.”