UK Christmas sales to see first fall since 1980s: survey

Retail consultancy Verdict forecast the retail market would shrink by 0.7 percent year on year in the fourth quarter of 2009, equivalent to a decline of 535 million pounds — the first fall since Verdict's records began in 1989.

It said the sales decline in non-food will be driven by a recession-related 1 billion pound fall in housing related sectors (DIY, electricals, furniture, floor coverings and housewares), along with the impact of price deflation in electricals and capacity withdrawal, such as the closure of toys-to-CD retailer Woolworths in January.

However, Verdict expected the food and grocery sector to grow 2.3 percent to 723 million pounds.

“Despite a shrinking market this does not mean we will see lots more retail casualties,” said Maureen Hinton, lead analyst at Verdict. “Many retailers will do better this year because they will pick up share from casualties, as well as being up against weak comparatives.”

Verdict also predicted British consumers will spend 6.8 billion pounds online this Christmas, an increase of 837 million pounds or 132 pounds a head, compared with a cut of 10.50 pounds per head in spending overall.

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