Some 73% of stores are now advertising special offers, that’s up on just 40% three years ago. The discounts themselves are better value for the consumer too: averaging at 47% up from 45%, reckons PwC in its survey of 100 retailers on UK high streets.
The sudden panic is connected to a rather large overhead that looms this time of year: the quarterly rent bill. Retailers are getting rather desperate: despite increased sales across the Queen’s Diamond Jubilee, the poor weather across June has dampened demand.
‘UK consumers are good at celebrating Jubilees, football prowess or potential Olympic glory but they are proving less willing to part with their cash except when the sun comes out or goods go on sale,’ explains PwC's chief retail adviser, Christine Cross. ‘Clothing purchases are weather-related and canny consumers also know mid-June means worried retailers who need to clear stock to leave room for new lines.’
This is bad news for high street brands, which were basking in the ONS’ news that retail sales were up 3.3% in May. And PwC forecasts a bumpy ride for retailers this summer, pinpointing a ‘troublesome’ trend at work, with shoppers eschewing full-price goods: ‘they have a love affair with value,’ reads the report. Even a spot of late summer sun won’t do much good, it adds. Not while the ongoing eurozone crisis continues to sap confidence.
However, while fashion sales and purchases for the garden have dipped, pubs and fast food chains have seen a real boost. Rather than have barbeques at home or buy a sun hat, Brits are heading the local to drown their sorrows and wolf down a ploughman’s.
And while discounts will erode margins, retailers are between a rock and a hard place with warehouses full of old lines. They need to clear stock and fast. Perhaps they should man the barrows and head down to Marylebone singing ‘Who will buy’? Doubt they can match two blooms for a penny, though…