Industry insiders give their reaction to latest ONS figures

British clothing and footwear retailers suffered their sharpest year-on-year decline since January 2022, with sales falling 2.6 per cent in November, marking the second consecutive monthly decrease. The Office for National Statistics' (ONS) latest retail monitor, which concluded on November 23, captured only a partial picture of consumer spending as it excluded the crucial Black Friday trading period.

Industry analysts cautioned FashionUnited that these figures could spell challenging conditions for the retail sector, particularly as businesses navigate the crucial holiday shopping season. Retail executives pointed to persistent inflationary pressures and weakened consumer confidence as key factors weighing on performance.

Deann Evans, Managing Director, EMEA, Shopify said:

After a rise in September and fall in October, it has been a tricky final quarter for retailers. The industry will therefore be pleased to see growth in November. Our recent Holiday Retail report revealed almost a quarter (24 percent) of UK consumers do the bulk of their shopping in the final two months of the year. In regards to specific products, November brought a renewed focus on holiday items. Parties and hosting was also a key shopping motivator."

Jim Rudall, Head of EMEA at marketing and email platform, Intuit Mailchimp commented:

“It’s peak time for retailers, so the industry will welcome the latest ONS figures. With consumer motivation to buy continuing to peak, businesses need to reach the right balance when it comes to promotional activity and engagement and think about how to drive the outcomes and opportunities that the season provides to gain longer-term customer value and loyalty. This is vital as for many retailers, the holiday season represents the year’s biggest opportunity to meet or exceed annual sales goals. In fact, one of our studies reveals two-thirds of marketers estimate that the holiday season drives between 21-40 percent of their company's annual revenue.”

Oliver Vernon-Harcourt, head of retail at Deloitte, said:

“Despite Black Friday not being captured in November’s figures, retail sales returned to positive territory, with consumers opting for earlier Christmas shopping to get ahead. This will be a boost for the retail sector, albeit slightly below expectations, with grocery and certain non-food retailers seeing their positive results offset by a slump to clothing and online sales."

“With costs expected to rise for retailers in the first half of 2025, they will have a successful Golden Quarter at the top of their wish lists. This may be delivered if consumers spend more this Christmas than in recent years, lifted by their more positive outlook on personal finances and attractive discounted offerings.”

Ben Swails, GM Northern Europe at business expenses solution, Pleo, said:

“It's positive to see the rise in retail sales for November, in what will deliver a much needed boost for British retailers. Yet with cost of living pressures continuing to scale, scrutiny on consumer spending will remain high. Our research shows that a staggering 76 percent of employees face higher work expenses in December, with over half (52 percent) paying double their usual amount. As a result, 48 percent of workers are left more out-of-pocket than the rest of the year. The impact this will have on disposable income and consumer spending cannot be underestimated.”

Matt Dalton, Consumer Sector Leader at Forvis Mazars, said:

“Overall November retail sales still came up shorter than expected, rising 0.3 percent for the month. Footfall especially in department and clothing stores was lower."

"The picture is a false one. The official Black Friday was on the 29th of November and was not covered in the survey, which goes up to the 23rd of November. This means that these numbers reflect consumer anticipation ahead of Black Friday, not a general slowdown in consumption. The pickup in retail should be, all other things being equal, apparent in December numbers."