Comment: UK retailers sense stability in consumer sentiment

The positive results last week from retailers including Asos, Dixons and Home Retail Group demonstrate the dangers of viewing UK retail as a single, endangered entity.

It has become too easy against the backdrop of administrations and glum sector sales to conclude that the entire industry is in crisis.

And, while figures from the Office of National Statistics once more paint a bleak picture of the overall landscape - retail sales were up only 0.3% by volume and 0.7% by value in December on 2011 - signs of an encouraging revival at Argos and the continued stellar growth at Asos point to a more complex picture.

No one is in doubt retail conditions remain punishing, but these results should act as a lesson to anyone relying on bare statistics alone to understand the sector’s future.

This week brings the launch of Retail 2013, our annual report, conducted with Kurt Salmon, into the expectations for the year ahead of 28 retail chiefs who between them account for 12,000 stores and £53bn in revenues.

It is a candid, qualitative view of the sector from those experiencing the nuances of this slow recovery.
In so much as it forecasts a continuation of 2012’s low growth environment, the interviews concur with the story told by the economic data.

But the report also picks up on a subtle change in consumer attitude and a normalisation of trading conditions. Let’s be blunt, this is based on a belief it’s no longer getting worse rather than any bounce in confidence.

It’s a small shift in attitude the stark numbers cannot convey, but it will be significant to the retailers seeking an answer about how to respond to the new environment.