The winners on the high street

The post-Christmas reporting season is in full swing, with Next having the most to cheer about.

Retailers' traditional post-Christmas reporting season is in full swing. Fashion group Next was one of the big winners, with sales between 1 November and 24 December jumping by 12%. Online sales jumped by a fifth at John Lewis, where internet sales comprised a third of the total. House of Fraser also performed strongly, unlike Debenhams, which issued a profit warning.

In the supermarket sector, J Sainsbury's strong Christmas allowed it to eke out marginal sales growth in the fourth quarter. The best-performing supermarkets were the premium and the discount chains. Aldi, Lidl and Waitrose have gained market share.

What the commentators said

This is counterproductive, as customers used to discounts early in the season become reluctant to pay full price for anything, while a track record of pre-Christmas discounting "appears to have started to erode shoppers' broader confidence" in a brand.

Having a strong online business was the other driver of healthy sales, said Graham Ruddick in The Sunday Telegraph. Next offered a free next-day delivery service to stores, so customers could order online the weekend before Christmas Day and collect it in time. As a result, internet sales did not fall off after a good start as they have in previous years.

John Lewis is also notable for its click-and-collect service. Sales of this kind rose by 60% year-on-year. The lessons, then, are simple, concluded Iain Dey in The Sunday Times. "Don't cut prices too far and find a way to make the internet work" for customers. Keep that in mind in the next few weeks as the "endless excuses" start to come out of retailers' mouths.

Recommended

Low growth and high inflation: a toxic cocktail for anxious markets
Stockmarkets

Low growth and high inflation: a toxic cocktail for anxious markets

Low growth, high inflation, central bank tightening, a strong dollar, and the risk of recession is proving a toxic cocktail for world stockmarkets – a…
6 Jul 2022
Imperial Brands has an 8.3% dividend yield – but what’s the catch?
Share tips

Imperial Brands has an 8.3% dividend yield – but what’s the catch?

With an impressive dividend yield of 8.3%, Imperial Brands looks to be one of the most attractive income stocks in the FTSE 100 . But investors should…
6 Jul 2022
Can Royal Mail continue to deliver its 7.6% yield?
Share tips

Can Royal Mail continue to deliver its 7.6% yield?

Royal Mail shares are yielding 7.6% this year. But it’s facing some huge challenges, says Rupert Hargreaves. So is Royal Mail’s dividend sustainable?
6 Jul 2022
Saga’s figures are heading in the right direction – so should you buy?
Share tips

Saga’s figures are heading in the right direction – so should you buy?

Saga the over-50s travel and financial services specialist, has been struggling for years. But now, with the pandemic behind, it it is planning for fu…
5 Jul 2022

Most Popular

Is inflation about to drop as recession takes hold?
UK Economy

Is inflation about to drop as recession takes hold?

Central banks are raising interest rates in an attempt to curb soaring inflation. But will that push the economy into recession? John Stepek looks at …
5 Jul 2022
Ray Dalio’s shrewd $10bn bet on the collapse of European stocks
European stockmarkets

Ray Dalio’s shrewd $10bn bet on the collapse of European stocks

Ray Dalio’s Bridgewater hedge fund is putting its money on a collapse in European stocks. It’s likely to pay off, says Matthew Lynn.
3 Jul 2022
Is it OK to buy Scottish Mortgage investment trust again?
Investment trusts

Is it OK to buy Scottish Mortgage investment trust again?

Scottish Mortgage investment was hit hard by the tech-stock crash, and it is still being buffeted by headwinds. Should new investors wait for those to…
5 Jul 2022