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British shops endure worst August for three years -BDO survey

Fri, 07th Sep 2018 00:01

LONDON, Sept 7 (Reuters) - British shops suffered theirworst August in three years, a survey showed on Friday, asinflationary pressures and a record heatwave drove consumersaway and a shift to buying online continued.

Accountancy and business advisory firm BDO said its monthlyHigh Street Sales Tracker (HSST) showed like-for-like salesdropped 2.7 percent in August from a year earlier.

That marked the seventh straight month that in-store saleshave fallen.

Above-target inflation and sluggish wage growth are dentingspending on goods other than food, while a record-breakingsummer heatwave made spending in bars and on entertainment moreappealing than shopping.

In the fashion sector, in-store sales fell every week inAugust, and by more than 3 percent during three of those weeks,for their worst performance since 2015.

Homeware sales did even worse, slumping 6.1 percent - thesub-sector's worst performance August since 2012.

In contrast, online sales of all goods jumped 13.7 percent.

"In a climate of rising interest rates, prices rising andsubdued real wage growth, there is limited discretionary spendleft and that is taking its toll on fashion and homeware sales,especially bigger-ticket items," said Sophie Michael, BDO's headof retail and wholesale.

A survey published by the British Retail Consortium (BRC) onTuesday reported sluggish sales growth for August.

Recent trading updates from retailers have also beensubdued.

On Thursday electricals and mobile phones retailer DixonsCarphone reported flat underlying sales in its latestquarter, while department store John Lewis said onTuesday that its total sales rose just 1.3 percent in the fiveweeks to Sept. 1.(Reporting by James Davey; Editing by Susan Fenton)

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