FSP Christmas Sales Report Christmas 2015 Issue 1 - 8 January 2016
FSP RETAIL BUSINESS CONSULTANTS
Comment: Plus ça change In FSP’s report on Christmas Sales in 2014, we questioned whether Black Friday does anything but shift sales to earlier in the year and cut margins, we noted the effect of the mild winter, we saw retailers heavily reliant on online sales and we recorded M&S not doing very well. Is this year any different? In a word, no. Currently, available data on which to comment is limited as retailers absorb the implications of trading over the festive season and decide how to present them. However, as normal we shall update our report for you throughout January. The usual picture is likely to emerge. We will see winners and losers, the strongest getting stronger and the weakest eroding their margins further to grab that sale. But on the back of a year of positive consumer confidence, Christmas 2015 was again a success for those with a strong and well-balanced multi-channel offer, good customer service and a value or distinctive product. The biggest difference now appears to be not whether we shop, but how we shop. It didn’t actually feel like Christmas, shopping in shirtsleeves, whilst elongated sales on the back of Black Friday did nothing to inspire the festive spirit. Hardly surprising that Notonthehighstreet.com delivered growth of 25% in total transaction value in the lead-up to Christmas. With savvy consumers seeking innovation, ease of mobile ordering and exceptional value the winners were those who could either offer the latest gadget or an integrated shopping solution. Wearable technology outstripped wearable anything else except, perhaps, wellies, whilst Jigsaw’s responsive website helped push online sales up 31% over last year. It’s not all about online though and the off-price stores and value end of the market treated Christmas as normal – a market to be exploited. Aldi and Lidl saw pre-Christmas growth, which probably continued with their festive offers of value finedining whilst, by contrast, Waitrose saw like-for-like sales down over the Christmas period for the first time since FSP started recording Christmas Sales. The competition for festive grocery shoppers drove grocery prices to their cheapest in over a year and 1% lower than those seen in November. (cont over…) 2
January 8, 2016
FSP RETAIL BUSINESS CONSULTANTS
Comment: Plus ça change (continued) Add in the painful experience of pre-Christmas purchases being returned and re-bought at a lower price, and the ever fateful rent quarter day, we won’t be surprised if this year bucks the recent trend of almost casualty-free Christmases and we’ll start to see the weaker retailers fall by the wayside. As retailers take stock, it’s good to know that in-store retailing is not completely dead. Most retailers recognise the inevitable attrition of internet sales and the best are addressing this by ensuring that in-store sales staff are provided with ammunition to persuade shoppers to buy at point of sale where possible (excellent staff training, special offers etc) – essentially, all the elements needed to offer a great instore experience. This even applies in the cut-throat electrical industry where incentivised selling is a thing of the past in some of the largest retailers and the efforts of sales staff are focused on ensuring that shoppers benefit from detailed advice whether the final sale is on the internet or instore. FSP remains convinced that bricks and mortar selling retains its relevance going forward but recognises that retailers will increasingly need to rationalise their retail portfolios to optimise performance across both physical and virtual networks. This will form the subject of a forthcoming FSP blog but meanwhile we will keep you all updated on Christmas reporting as it unfolds.
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January 8, 2016
FSP RETAIL BUSINESS CONSULTANTS
Like-for-Like Averages by Group Individual categories will be detailed in future editions of this report
Number of retailers by category in this sample: Food & Beverage Department Stores Household Leisure Grocery Clothing & Footwear Personal
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2013/14 2014/15 2015/16 7 5 0 7 6 2 7 7 3 6 7 3 11 12 4 14 15 5 6 7 6
FSP RETAIL BUSINESS CONSULTANTS
All Retailers Many retailers are yet to report on their trading over the festive period. Future editions of the FSP Christmas Sales Report will break down the retailers into their Merchandise Groups, however, with currently so little to report, the data are only shown in the All Retailers graph.
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January 8, 2016
FSP RETAIL BUSINESS CONSULTANTS
Christmas Trading and Administrations FSP records Christmas casualties as those who fail during the key period of Christmas Eve to the middle of January. Things have looked much brighter in recent years, although last year was slightly marred when Bank failed whilst the administration of USC was just a restructuring exercise. The number of retailers recorded on SnapShop entering administration in each of the past few years is: 2015 – 4 2014 – 9 2013 – 43 2012 – 44 2011 – 57 2010 – 42 2009 – 93 2008 – 56
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January 8, 2016
FSP RETAIL BUSINESS CONSULTANTS
Future Editions The FSP Christmas Sales Report will be updated throughout January. Future editions will include graphical representation under the following headings: 3 year comparison Merchandise Groups: Department Stores Personal Goods Clothing & Footwear Household Goods Leisure Goods Grocery Food & Beverage Online Sales FSP Christmas Sales Report Methodology FSP seeks to gain an accurate review of the Christmas period, hence the period end date must be at least Christmas Eve and no later than the end of January; the period must be 13 weeks or less. Online Sales are always shown as Total changes. Graphs are ranked in order, highest to lowest, first by Like-for-Like change, then by Total change FSP has gone to its best efforts to ensure this data is correct but the author reserves the right not to be responsible for the accuracy of information provided.
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January 8, 2016
FSP RETAIL BUSINESS CONSULTANTS
Heidi Roberts Scribe
Tanu Bajaj Wizard
Bekki Bedford Guru
FSP RETAIL BUSINESS CONSULTANTS
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