According to data published this week by the Confederation of British Industry (CBI), 45 per cent of retailers surveyed, claimed their sales volumes are significantly higher than those recorded a year ago, with only 8 per cent reporting a year on year drop.
This means that the balance amounted to +37 per cent, which was the strongest result since June 2012 resoundingly outstripping predictions made by City analysts which amounted to a balance of no more than +15 per cent.
As has been the trend in recent months, in large part thanks to the housing boom, furniture and homeware stores performed most strongly during the survey period, which took place between the 23rd of January and the 12th of February. In addition, grocers and fashion retailers experienced a much-needed surge in sales, meaning sales recovery was relatively stable across the majority of sectors.
This good news has meant that many are now considering their options when it comes to active growth, with more firms participating in the survey intending to invest rather than freeze or cut growth revenues. Hopefully this will have a positive effect upon employment, where widespread cuts blotted an otherwise wholly positive report for the retail industry.
Chair of the CBI distributive trades survey panel and Asda’s chief merchandising officer for food, Barry Williams, says; “The high streets have kicked on once again this month, with growth the strongest since the summer of 2012.
“There is growth across many sectors, including grocers and clothing outlets, while investment intentions are at their highest for more than three years.
“Although we are by no means seeing a universally confident shopper, the positive indicators have perhaps given some people the urge to spend.”
All in all, the CBI believes that the current year on year sales growth amounts to around 4.5 per cent – a staggering amount even taking into account the recent drop in consumer price inflation which caused many shoppers to take to the high street. Should this continue, the retail industry could soon be seeing results which reach those made in the years before the recession hit in 2008.
Unfortunately, HIS Global Insight chief economist Howard Archer does not believe this will be possible without a strong recovery in wages.
He says; “Consumers have faced a prolonged squeeze on their purchasing power, and this is currently easing only gradually even though consumer price inflation has come down to a 50-month low of 1.9 per cent in January.
“This is because annual earnings growth is only slowly picking up and was still limited to 1.1 per cent in the three months to December.”
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