This early discount has encouraged many consumers to bring their Christmas shopping forward as they have looked to bag some of the bargains on offer. The Confederation of British Industry has released data which has shown 71% of businesses have revealed higher volumes in the 2 weeks up to December 11th than that time in the previous year, the highest percentage increase they have seen since 1988.
“The strongest sales growth for a quarter of a century is a big boost for retailers as they head towards the climax of the crucial pre-Christmas trading period,” said Barry Williams, Asda’s chief merchandising officer for food and Chairman of the Confederation of British Industry survey. “Black Friday price-cuts, embraced more widely by more UK retailers than ever, and discounting played an important part in helping sales, encouraging more customers into stores and online to buy more widely.”.
Things look positive for retailers in the coming months too, “The recent fall in the price of oil means more purchasing power for consumers,” said Colin Bermingham, an economist at BNP Paribas. “With inflation now falling below wage growth, real incomes are finally improving in the UK. The labour market data released this week show the wage growth is picking up, especially in the private sector. This bodes well for retail sales growth in the months ahead.”
Yet is it coming at a cost? Retailers are being forced to reduce their prices in order to keep up with their online competition as well as rivals on the high street. As consumers are becoming increasingly savvy and price conscience, retailers have been jostling to provide the lowest prices to retain market share. Supermarkets in particular have had to react in an attempt to fight the competitor from Lidl and Aldi. It will be intriguing to see who buckles under this increased competition.