Retail Recovery?

Good news for retailers?

Data from The Local Data Company suggests that vacancies in town centre retail units fell to 13.9% in December from 14% in November. A two tenths of one percentage point drop may not seem wildly optimistic but importantly this is the first time since July 2010 that the figure has been below 14%.

The reported sales for retailers has been mixed for the Christmas period with John Lewis and Next posting like for like sales increases which supports the notion that top end discretionary spend is holding up. Other retailers posting strong results have been budget retailers Aldi and Lidl.

Some large supermarkets including Tesco and Morrisons have posted reductions in like for like sales of 2.4% and 5.6% respectively (Morrisons claim a lack of online presence for the fall) and M&S general merchandise sales were down but food and particularly online sales performed well.

At almost the midway point in January we are not aware that any household name high retailers have been placed into Administration. Last year such retail casualties included Jessops, HMV, Blockbuster and Republic being placed into Administration.

Commentators expect the large four supermarkets to enter into a price war to attract our hard earned cash which could be good news for cash strapped consumers. With more retail space being taken up this could mean more competition between retailers. Whilst this is likely to be good news for consumers what will be the outcome for retailers?

What is clear is that online sales have increased sharply, but what will be the impact on the high street?