Retailers slash prices by up to 80% in biggest pre-Christmas discounts EVER as High Street shops and online traders go head to head in battle for a slice of Britain’s £82bn festive splurge
- Average discount now at 43% but could top 50% by Christmas Eve for first time
- Discounts range from 8% to 78% with greatest savings in mid-market clothing
- Mild autumn means retailers are sitting on a mountain of coats and scarves
- Around 20% of all retail spending occurs in two months ahead of Christmas
Desperate retailers are running their deepest ever pre-Christmas discounts as they chase a share of the nation’s £82billion of festive spending.
The average discount is running at 43 per cent but could top 50 per cent by Christmas Eve for the first time, according to analysis by accountants Deloitte.
It said the current discounts range from 8 per cent to 78 per cent with the greatest savings to be found in the mid-market clothing category.
Retailers have their deepest ever pre-Christmas discounts, including these pictured above
A relatively mild autumn means retailers are sitting on a mountain of coats, woollens, scarves and boots.
Around 20 per cent of all retail spending occurs in the two months ahead of Christmas and retailers which fail to cash in during this crucial period face a bleak New Year.
The Black Friday sales event has the effect of bringing forward Christmas spending to the last weekend in November, but this effectively sucks the lifeblood out of town centres during December.
Lead consumer analytics partner at Deloitte, Jason Gordon, said: ‘Retailers have faced a challenging year, as consumer confidence has continued to fall amidst macroeconomic uncertainties.
‘In addition, the introduction of Black Friday in recent years means consumers have also come to expect an increasing amount of pre-Christmas discounting.
M&S, which has tried to steer clear of events like Black Friday and festive sales across the store, is running a series of offers such as 40 per cent off party wear
The result is a blending of promotions, one seeping into the next, and a steady price decline rather than a steep Boxing Day drop, reminiscent of Christmases past.
‘With one shopping weekend left before Christmas, this week could see a tipping point in promotions.’
Retail analyst Richard Hyman described Black Friday as an ‘act of industry-wide self-harm’ and predicted further and deeper price cuts all the way to Christmas and beyond.
All the evidence suggests that the number of people visiting high streets and retail parks is down on last year, which means stores feel under pressure to shout about sales to get people through the door.
Boots is promoting savings of 50 per cent coupled with flash sales in particular departments, such as beauty products
While many people have switched to shopping online, there is evidence that this will overcome the fall in takings at the till suffered by bricks and mortar stores.
The Springboard company, which measures shopper numbers in streets and retail parks, said the figure over the past week was down by around 5 per cent on last year.
It said the figure is expected to peak on ‘Super Saturday’, which falls on December 21, as people rush to supermarkets with food making up some 40 per cent of all festive spending.
Insights Director at Springboard, Diane Wehrle, said that while Black Friday was a success in terms of sales and shopper numbers, it is no surprise that streets are now relatively quiet.
‘We are not surprised that footfall has not increased over the last week, as it follows a Black Friday success that confounded expectations,’ she said.
Boohoo’s website is currently boasting of ‘Up to 80 per cent off absolutely everything’
‘Consumers clearly took advantage of early discounts to purchase Christmas presents, and are now waiting for discounts to deepen once again in the days immediately before Christmas as retailers do their best to shift unsold stock.
‘Super Saturday is once again expected to be the peak Christmas trading day, although with Monday and Tuesday still offering consumers opportunities to purchase last minute gifts, its success will be more muted than if Christmas were landing on Monday or Tuesday when purchasing opportunities post Saturday would be more limited.’
The grim figures on discounts and shopper numbers suggest the country could see further high profile failures in early 2020.
Big names like Mothercare and Thomas Cook have gone, while others like House of Fraser, Debenhams and Marks & Spencer, which is encouraging people to shop through its website, are shutting stores or reducing floor space.
Retailers like AO.com are running deals on TVs, coffee machines and household appliances
M&S, which has tried to steer clear of events like Black Friday and festive sales across the store, is running a series of offers such as 40 per cent off party wear and a two for £60 deal on Merino jumpers.
For example, a black Lace High Neck Shift Dress is down from £59 to £35.40 and a Per Una Floral Wrap Midi Dress is down from £65 to £39.
Others like Currys PC World and AO.com, are running deals on TVs, coffee machines and household appliances.
Gap, Boots and the department stores are promoting savings of 50 per cent coupled with flash sales in particular departments, such as beauty products.
People queue outside JD Sports on Oxford Street in London on Black Friday on November 29
And John Lewis has no choice but to be pulled into the price cutting because of its ‘price match’ promise.
Online ‘fast fashion’ chains have been running sales for weeks. Boohoo’s website is currently boasting of ‘Up to 80 per cent off absolutely everything’.
It was selling a Snake Print Tiered Kimono reduced by 80 per cent to £4, although most of the deepest reductions were 50-60 per cent.
ASOS is promoting a ‘Get up to 50 per cent off’ sale. Deals included a French Connection rollneck knit jumper down from £75 to £38, while a Collarless Belted Blazer was 81 per cent off, marked down from £32 to £6; and a Double Breasted Cord Blazer was down 71 per cent with the price slashed from £35 to £10.
Bloodbath on the High Street: How shops in the UK went from bustling to bust
Mothercare and Mamas & Papas are the latest UK retailers to feel the pressure of the recent downturn affecting the high street.
According to KPMG, 44 retail businesses entered administration in just the six months to September, including a number of high street stalwarts.
Here are some of the key retailers which have gone bust or entered administration in the recent months and years:
-Mamas & Papas
Mamas & Papas collapsed into administration last month with six store closures, just days after rival Mothercare went bust. The retailer made 73 staff redundant and put 54 further jobs at risk within its head office.
Mothercare collapsed last month, leading to the closure of its 79 stores and loss of 2,800 jobs. Bosses blamed the high street’s ‘near existential problem’ for the firm’s demise.
The fashion retailer was bought from administration in a rescue deal in April, but said it would close 10 stores with the loss of 110 jobs after a downturn in performance.
Jack Wills collapsed into administration in August before it was snapped up by retail tycoon Mike Ashley.
-Karen Millen and Coast
All Karen Millen and Coast’s 32 UK stores were closed in September after it slid into administration, although its online brand was saved by Boohoo.
Patisserie Valerie went into administration in January before being rescued after an equity fund agreed to acquire the café chain, saving about 2,000 jobs. The buyers intend to keep open 96 stores across the UK.
All but three of Jamie Oliver’s 25 UK restaurants closed in May after it went into administration with the loss of 1,000 jobs.
Up to 20 Byron outlets closed in a rescue plan for the burger chain, it announced in January when it had about 1,800 staff employed.
-Links of London
The jewellery retailer is in the midst of an administration after a tumultuous spell under the ownership of Greek business Folli Follie, leaving its 35 stores and 350 jobs at risk.
High street hairdressing chains Supercuts and Regis, which have 223 salons in total, are under threat after their owner fell into administration.
The value retailer fell into administration last month, raising fears over the future of its 318 shops and 2,900 staff. It is currently searching for a buyer.
Bathstore fell into administration in June, but 44 of the company’s stores were saved in a rescue deal with Homebase.
The fashion retailer fell into administration in May, before launching a CVA restructuring plan in June.
The travel business was the most notable failure of the high street, collapsing with 800 stores, although 555 of these were saved by rival Hays Travel.
The wine specialist closed a raft of stores after it fell into administration in February, the second time it had collapsed in around eight years.
The department store chain entered administration in April as it sought to reduce its debt and start a major restructuring process, which would result in store closures.
-Toys R’ Us
The UK’s largest toy shop went into administration in February 2018, leading to an estimated 2,000 redundancies.
-House of Fraser
The department store chain was on the verge of heading into administration but was rescued at the eleventh hour by Sports Direct owner Mike Ashley.
The electronics giant has gone bust, closing shops across the country and putting thousands of jobs at risk.
Poundworld announced it was going into administration in June 2018 after talks with potential buyer R Capital broke down, putting 5,100 jobs at risk.
The DIY chain set to close 42 DIY outlets shut, putting around 1,500 jobs at risk.
Orla Kiely, the Irish fashion retailer collapsed in September and closed all its stores after a slump in profits.
Last December HMV entered into administration with its flagship London Oxford Street having closed earlier this year.
In March, Liam Gallagher’s Pretty Green filed a notice of intention to appoint Moorfields Advisory to handle insolvency problems across its UK stores. At the beginning of April 2019 JD Sports purchased the company, saving around 70 jobs.
The carpet retailer is closing 92 stores across the UK. These closures represent nearly a quarter of all UK Carpetright stores.
Source: Read Full Article