Retailers forced to discount winter wear as mild weather continues

The UK has experienced well above normal temperatures during the last few weeks during what has been a very warm autumn for the northern hemisphere as a whole.

Met Office figures suggest that last month was the seventh warmest October since records began in 1884, and temperatures could reach 18 degrees in some parts of the country this week, according to forecasters.

And this has meant British shoppers have delayed buying coats, boots and hats and other cold weather gear - heaping pain on an already under-pressure retail sector.

Many fashion brands often introduce next season’s ranges well ahead of the season arriving, which means an Indian summer running into September, or even October, could mean they have to discount the already introduced autumn/ winter ranges to make sure they hit sales targets for the period.

Indeed, such is the close link between retail sales and the weather that the Met Office suggests that a two degree drop in minimum temperature can increase sales by more than 6%.

Yesterday, luxury British designer Joules blamed the mild autumnal weather for a slump in sales of coats and wellies.

And figures from the British Retail Consortium (BRC) released this morning [Tuesday] showed that non-food retail sales decreased by 1.2% on a total basis and 1.8% on a like-for-like basis during October, compared to an average growth of 3.7% over the last 12 months.

“The unseasonably mild weather in October led to a decline in clothing and footwear sales as customers wait for temperatures to drop before fitting out their winter wardrobes with coats, boots and scarves,” explains James Hardiman, retail analyst at the BRC.

“As the weather gets colder and wetter this month, retailers hope that clothing sales will experience an uptick.”

Duncan Brewer, a partner in EY’s retail & consumer products team, agrees that the milder weather has been a factor in spending decisions - although says there are lots of other issues at play.

“Consumer confidence is at an all-time low. Certainly the weather is having an effect [on retailers’ sales] but there are fundamental realities about the British shopper at the moment which are really impacting spending.”

A difficult autumn has hit after many of the fashion retailers enjoyed good summers, he points out, with sales in July and August driven by hot weather at home and people taking holidays for the first time in two years.

“People have realised they spent a lot [during the summer], and now they want to save up for Christmas - the first one we’ve had in two years without restrictions,” he says.

This means many retailers are launching discounts or sales.

“The sensible [retailers] have been discounting for a while. Increasingly I’m hearing people refer not to Black Friday, but to Black November.”

But there are some retailers which have recorded good performances in recent weeks, including Next and DFS.

“That’s almost more encouraging in many respects as it is better than many expected,” says Jonathan Pritchard, retail analyst at Peel Hunt.

“In the quarterly reports a few bad weeks are soon lost, but most will doubtless be hoping for some chillier days. They’ll have sold plenty of macks and cagoules though.”