First came the footfall reports, now the retail sales and consumer spend reports are beginning with three on Tuesday — from BDO, Barclays and the British Retail Consortium — showing that the festive season was a bit, well “meh”.

Bearing in mind that some of the actual figures will vary based on different tracking methodologies, slightly different time periods covered and other specific variations, there was general agreement that the so-called Golden Quarter and last month were disappointing.

First BDO. Its monthly High Street Sales Tracker (HSST) said total sales in discretionary spend categories increased by 7.7% in December, compared to a negative base last year, which is good news, right?

Well, that number failed to boost overall growth in the Golden Quarter. While Black Friday, Cyber Monday and Christmas Eve drove sales growth both online and in-store in December, like-for-like sales figures for the final three months of 2024 saw overall growth of just 2%. Admittedly, that’s better than the 1.6% drop in 2023 but isn’t the more spectacular figure that had been hoped for and barely makes up for that earlier drop.

And physical shops fared particularly poorly in this period, with sales virtually flat at +0.1% compared to 2023’s base of -0.2%.

Outside of the first and last weeks of December, which saw the major sales events, high street sales “performed very poorly”, with sales declining 3.91%, worse than 2023’s 3.61% fall. Bad weather and widespread flooding may have driven consumers to shop online, where sales increased by 20.7%.

And BDO said the fashion sector performed particularly poorly.
Sophie Michael, Head of Retail and Wholesale at BDO, said: “This is a continuation of the poor performance we’ve seen throughout the Golden Quarter. After a challenging year, this low level of growth is a real concern for the retail sector. The struggling performance of high street stores is particularly notable, with essentially flat growth against last year’s very poor baseline, meaning that volumes were once again negative.

“The biggest concern is that 2025 is not expected to improve as businesses are yet to feel the impact of increased wage costs introduced in the Budget which disproportionately impacts consumer-facing sectors. 

“The sales figures we’ve seen through the Golden Quarter reflect consumer sentiment over the last few months. Consumer spending declined significantly before and after the Budget, and despite a late flurry of spending just before Christmas, that hasn’t been enough to salvage the festive period for retailers.”

Barclays report

As for the figures from Barclays, they cover general consumer spend rather than just retail sales. The bank said consumer card spending stalled in December “as joy-seeking Britons prioritised entertainment and travel over essentials”. Spend was flat overall.

Trips to shows, cinemas and more jumped, but eating and drinking out saw only modest increases as socialising was limited, perhaps because of winter flu, colds, Covid and other bugs proliferating.

But pharmacy, health & beauty saw a 4.8% boost and travel was up 4.7% as consumers flew to the sun (which might also have boosted fashion and beauty sales).

Given that sales remained flat, the fact that the CPIH inflation rate is running at 3.5%, means sales actually fell. And clothing sales fell 0.7%. Again, with inflation factored in, the figure would have been worse.

And in a related survey, Barclays discovered that 48% of consumers are planning to cut down on discretionary spend.

BRC blues

Finally, the British Retail Consortium-KPMG Retail Sales Monitor for the period from 24 November to 28 December included Black Friday so UK total retail sales rose 3.2% year on year. 

If we take the last three months together (which cancels out the skewed figures due to Black Friday timing), sales growth was only 0.4%. And for the entire year, UK total retail sales increased only 0.7% from 2023. The non-food decline was 1.5%.

In December including Black Friday, non-food sales rose 4.4% year on year. In-store, such sales rose 0.4% (but failed to make up for a bigger decline a year earlier). Online, they increased by 11.1%.

BRC CEO Helen Dickinson said: “Following a challenging year marked by weak consumer confidence and difficult economic conditions, the crucial Golden Quarter failed to give 2024 the send-off retailers were hoping for. Non-food was particularly hard-hit, with sales contracting from the previous year. 

“While we project sales growth to average 1.2% in 2025, this is below the projected shop price inflation of 1.8%. This means volumes are likely to fall this year, all while the regulatory and tax burden on retailers will increase costs by £7bn from rising National Insurance Contributions, increasing national living wage, confirmed in the Budget, and new packaging levies.”

Linda Ellett, UK head of consumer, retail & leisure, KPMG, added: “With Black Friday falling as late as it did, this year it was part of the Christmas shopping season even more so than in previous years.

“December, coupled with Black Friday week at the end of November, delivered welcome sales growth for retailers.  Computing and mobile phones, and beauty products, particularly saw sizeable jumps in sales both in-store and online, with the likes of AI-enabled tech and beauty advent calendars boosting festive takings.

“However, sales growth during the Golden Quarter of October to December was minimal, reflecting the ongoing careful management of many household budgets during a time when many costs remain at a heightened level compared to past years.”