High street retailers report a significant slowdown in sales this April as consumers start to reign in their spending.
After a promising March, retailers are finally feeling the squeeze as shoppers steer clear of the high street. While poor weather and an early Easter are being blamed, it’s undeniable that tightening credit conditions have played a considerable role in April’s slowdown, with stores selling household goods and home wares being hit the hardest.
Figures, released as part of the CBI’s monthly Distributive Trades Survey, revealed that over 50% of retailers reported a significant drop in sales this April in comparison with volumes traded during the same month last year, resulting in the lowest balance seen for two and a half years.
What’s more, current forecasts for sales performance in May aren’t much better as predictions suggest consumers will continue to be cautious with their spending as a necessary measure to cope with the increasing cost of living.
Commenting on this gloomy snapshot of the high street the CBI’s chief economic adviser, Ian McCafferty commented:
“There is no doubt that consumers are tightening their belts as the mood about the economy and its outlook worsens. The trend in recent months has been one of slowing growth and now we've seen a fall in sales volumes, particularly so for goods related to the housing market.”
However, while the slowing property market has obviously impacted consumers’ need to shop for home wares, to some extent the poor weather we have seen this month will also have played a part in orchestrating the sales slowdown as potential shoppers choose to stay at home in the dry rather than embarking on new DIY projects as is traditional for this time of year.
What’s more, with the four day Easter weekend falling in March and no April bank holidays, retailers have missed out on the boost this break usually provides.
So, while a significant slowdown in sales was seen this month, the outlook may not be quite as bleak as the figures initially suggest especially as the high street had remained reasonably hardy against the current turbulence hitting the money markets so far.
