No cheer for retailers ahead of Christmas, says CBI

20th Dec 2024 14:16

(Sharecast News) - UK retailers were struggling to find any cheer in the run up to Christmas as sales fell amid worries over rising costs next year, according to the Confederation of British Industry.

The business lobby group's monthly retail sales headline balance improved to -15 in December from -18 in November.

Sales volumes were judged to be "poor" for the time of year, to a similar extent as in the previous month (-23% from -22% in November). Retailers expect sales to remain below seasonal norms in January, but to a lesser degree (-18%).

"Retailers have endured a gloomy festive period," said CBI cconomist Martin Sartorius. "Looking ahead, retailers expect sales to fall again in January, while wholesalers and motor traders are braced for sharper sales declines."

Retailers face higher costs after Finance Minister Rachel Reeves lifted employer national insurance contributions and the minimum wage. Both measures will take effect from April 6 next year.

The CBI survey was based on responses from 72 retail chains and 92 wholesalers between Nov. 25 and Dec. 12.

"The government can take steps to support firms' confidence by implementing a faster, more transformative timetable for business rates reform and developing a long-term, modern industrial strategy to unlock innovation, attract investment and drive sustainable economic growth," said Sartorius.

Reporting by Frank Prenesti for Sharecast.com