Retail bosses stay optimistic
TEES Valley retailers say Christmas can still bring festive cheer, despite more miserable data from the high street coinciding today with the VAT cut to 15%.
According to the CBI’s latest Distributive Trades Survey, the retail sector remains “deeply gloomy” amid declining confidence and a worse than expected fall in sales.
Around 16% of firms said sales were higher in the first half of November compared with a year ago, while 62% said they were lower. The resulting balance of -46% is a marked decline on October (-27%) and worse than retailers expected (-25%).
A net 40% of respondents expected a strong fall in year-on-year sales in December, while a balance of 57% plan to cut expenditure - the weakest figure since the survey began in 1983.
Meanwhile, Experian’s Retail November FootFall Index recorded a 0.9% fall in the North-east on the same month last year - equal to the UK average - while nationally the demise of Woolworths and MFI contributed to a 21% rise in retail business failures.
Despite the gloomy data the Tees Valley has seen a number of store openings in the last few days including Boyes department stores and Aldi both launching new branches in Middlesbrough. And Tees Valley retail bosses are cautiously optimistic about the year ahead.
The Mall in Middlesbrough has seen a modest drop in footfall of under 0.1% for the year to date - representing about 8,000 people out of a total of 9.68m - while footfall was down a better than average 0.3% in the month to November 26.
General manager David McNee said that while some retailers were struggling, there was plenty of activity in the centre despite the blow of “big footfall driver” Asda George pulling out earlier this year. He said: “We are cautiously optimistic about Christmas. I have not seen a huge amount of aggressive discounting in The Mall.”
Middlesbrough-based retailer Steve James is equally bullish and is forging ahead with plans to double year-on-year revenues through his outlet Steven James Guitars. Combined profits in October and November doubled those in the same two months of 2007. Mr James said some retailers were in danger of falling into a negative mindset due to constant coverage on the country’s economic woes.
