Warm September could cost £320m in non-food retail, fashion to be hit
Predictions of high temperatures during September may be good news for consumers, but they’re less so for the fashion retail sector, the British Retail Consortium said Thursday.
The BRC predicted that the return to warm weather next month in the UK could mean non-food retailers lose as much as £80 million a week off their potential turnover.
If that happens, it would be the second disastrous start to the autumn fashion season in a row after 2017’s unseasonably warm October saw sales of cold weather clothing diving.
The BRC said that its prediction is based on Met Office analysis of weather data that shows a "clear relationship" between temperatures and retail sales.
While the higher temperatures that have been seen in 2018 have had an effect all year round, the warmer spring actually boosted sales. But warm weather is most likely to have a negative impact at the start of the autumn season.
That’s because the fashion being delivered to stores for the season ahead is frequently out of sync with what consumers want to wear in the here and now.
The impact is claimed to be particularly acute from the middle of August up to early October when retailers are hoping that consumers will invest in more expensive purchases such as coats and boots.
The BRC said that in those few weeks, for every single degree warmer than the previous year, sales growth is down by about 1.1%. That means every single degree could wipe around £40 million off sales on a weekly basis and if it’s several degrees warmer, the losses will only mount.
So far this year, this summer has been blisteringly hot, but even with the end of the heatwave, temperatures have been around 2° higher than a year ago.
And of course, we also have to take account of consumer confidence, which is low at present due to slow Brexit negotiations. This could also dampen demand for new season fashion.
Rachel Lund, BRC head of insight and analytics, said: "While few in the retail industry would deny that the weather impacts how we shop, the fact that this study reveals that its impact can be large and changeable only serves to highlight some of the complexity retailers have to navigate in serving consumers.
"The ability to understand and respond to unseasonable weather is clearly crucial for retailers wanting to thrive in today's extremely competitive retail market."
While the report also said that sales lost early in the season are usually recovered later on, that isn't necessarily great news for the retail sector. The sales made weeks later than hoped-for are less likely to be at full price, and regardless of that, delaying turnover can also have an impact on a business's cash flow.
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