Christmas cheer on the High Street as sales soar 6.9% on 2021

The high street enjoyed a dose of Christmas cheer as it defied fears that the country’s shops would suffer a festive carnage.

Boosting the retail sector, the figures showed December sales were 6.9 percent higher than a year earlier, more than double the 3.1 percent average growth seen for the year.

The report, from the British Retail Consortium (BRC), says that households ‘braved the cold snap and strikes’ to buy Christmas presents for friends and family.

BRC boss Helen Dickinson, however, attributed much of the increase to higher prices.

And she warned of a difficult year as consumers rein in spending in the face of continued high inflation.

Retailers are also being hit by higher energy bills as the government phases out support, she added, leading to further price increases for consumers.

The warning comes at the start of a crucial week for companies updating investors on how they fared over the holiday season.

Marks & Spencer, Sainsbury’s, Tesco, Asos and Halfords are among the companies that will publish results.

Last week, retail giant Next defied economic doom and gloom by revealing bumper sales over Christmas. Boots, Greggs and B&M Bargains also reported bullish numbers, suggesting that households continued to shop despite the rising cost of living.

And yesterday, German discounter Lidl said it attracted an additional 1.3 million customers in December, with sales up a quarter from a year earlier.

That followed rival Aldi, which saw sales soar over Christmas as consumers flocked to the discount chain for their festive store in need of money.

The BRC report showed that the rise in December sales was driven by food as families splashed out to celebrate their first Christmas without Covid restrictions in three years. The figures showed that food sales were up 7.9 percent in December from a year earlier.

Non-food sales were also up 1.5 percent, with the more modest increase coming as shoppers shunned big card purchases like TVs.

Instead, they bought clothes, beauty products and energy-efficient appliances, the numbers showed.

Dickinson said: ‘After an exceptionally challenging year in which inflation rose and consumer confidence plummeted, the rebound in spending over Christmas gave many retailers cause for joy.

“Many consumers braved the cold and strikes to make sure friends and families got the gifts they wanted, with energy-saving products, warm clothes and boots all selling well.

Nevertheless, despite stronger sales, growth remained below inflation, making December the ninth consecutive month of declining volumes.’

Dickinson warned there will be “further headwinds” for businesses this year, saying “further price increases will be inevitable” as energy bills rise.

Accounting giant KPMG said sales growth in December was driven by higher prices, with the actual amount of goods sold falling.

Paul Martin, head of UK retail, said retailers are facing a ‘challenging few months’.

He said: ‘The strong demand in certain categories that has shielded some retailers is bound to wear off, so we can expect High Street casualties as we head into spring.’