LONDON Jan 8 British high street stores offered
their biggest pre-Christmas discounts in at least seven years
last month, industry figures showed on Wednesday, highlighting
tough trading conditions despite an improving economy.
The British Retail Consortium said shop prices in early
December were 0.8 percent lower than the same time in 2012, the
biggest annual decline in any single month since the survey
started in 2006 and the eighth consecutive month of falling
The price slide reflects widespread discounting by British
retailers in the run-up to Christmas. Although Britain's economy
grew strongly in the first nine months of 2013, wages have
stagnated and households have had to fund higher spending by
Research in mid-December by accountants PwC found almost
three quarters of high street retailers had started sales or
were advertising promotions in their shop window, such as
three-for-two offers. It said average price discounts being
advertised were 46 percent.
Major high-street clothing retailers Debenhams,
Marks & Spencer, Gap and French Connection
heavily promoted pre-Christmas price cuts.
Only a few UK clothing retailers, such as Next and
SuperGroup, which have longstanding policies of not
going on sale before Christmas, refrained from price cuts.
The BRC data showed that clothing prices in December were 10
percent lower than a year earlier.
The BRC's measure of shop price inflation does not include
online retailers or costs such as energy, transport and housing,
which feed into the broader official consumer price inflation
(CPI) measure targeted by the Bank of England.
CPI has fallen sharply in recent months and touched a
four-year low of 2.1 percent in November, but consumer prices
are still rising more than twice as fast as wages - leading to
claims of a 'cost of living crisis' from the opposition Labour
The BRC said non-food prices fell by an annual 2.3 percent
in December, just short of October's hefty 2.4 percent drop,
while food prices rose by just 1.7 percent, their smallest
increase since June 2010.
British retailers have reported a mixed Christmas in terms
of sales, with some of the strongest performers being stores
such as Next which did not discount.
The BRC publishes the first comprehensive Christmas sales
data for the retail sector on Friday.