Poor Christmas sales expected to be reported right across the board

In the last month of 2012, analysts’ reports and projections were mostly on the gloomy side as far as retail sales volume is concerned. Some of Britain’s largest chain stores including Wm Morrison, Tesco, Marks & Spencer and Sainsbury will be publishing their reports on sales volumes this week, and in all cases the prognosis from the analysts is fair to partly cloudy at best.

However, Britain’s biggest department store group, John Lewis, has ‘bucked the trend’ and contradicted the prognosis; they already published their year-end updates and showed a marked increase in like-for-like sales during the five weeks to 29 December, up 13 percent from the same period in 2011. However the online sales were even stronger, up 44 percent from 2011 and breaking £800m by the end of December.

The managing director, Andy Street, said the online bonanza did not undercut sales ‘on the ground’ at John Lewis stores; he said customers are “using both channels”, and he does not think any other retailer will be able to top his company’s performance. A Conlumino analyst agreed, saying that John Lewis

has set the bar very high, in part because of their ‘click and collect’ service which allows customers to order online and pick up merchandise at Waitrose sites. The supermarket is also part of the John Lewis group.

In trading on 2 January, shares in Wm Morrison fell by 3p, and retail broker Jeffries reported that the company’s Christmas sales could have fallen by as much as 2.7% on like-for-like sales. In Morrison’s case, it will probably be a tough year as the company tries to regroup; the lack of an online shopping option is one of the big drawbacks, according to most analysts.

It’s possible that online wine sales via Morrisons Cellar could start to address that problem. This week will see the release of trading updates from other major brands including Tesco, Debenhams, Sainsbury and Domino’s Pizza.