High Street Stores in the UK Had Their Worst September in Nearly a Decade

LONDON—September is a time typically synonymous with shopping. Back-to-school deals run rampant, and the promise of a new season—and all the clothes that come with it—urge shoppers to visit stores and refresh their fall wardrobes. But the usual draws failed to lure in customers in the U.K. this past September. High street stores—an area packed with stores like British brands Topshop, Marks & Spencer and John Lewis as well as worldwide chains like Zara and H&M—had their worst September since 2011. According to data from the accountancy firm BDO, which monitors the area's performance with its High Street Sales Tracker, same-store sales fell 3.1% this year compared to last year. And in 2018, they had already fallen by 2.7%. This means that high street stores overall faced their lowest sales numbers since the beginning of the decade. “Cash-strapped retailers are in dire straits," said Sophie Michael, head of retail and wholesale at BDO. "It has been a disastrous year for the high street, and as consumers continue to tighten their belts, they are entering the crucial ‘golden’ trading quarter on very unsteady ground." Michael added that further action will be necessary to save Britain's high streets—and not just from the retailers themselves. "Business owners have long-called for business rates reform, and while I agree this is needed, more urgent government action is required to help our failing high streets into 2020," she added. A major reason for the inaction on the part of the British government regarding high street performance is Brexit, which is set to occur on Oct. 31. It also likely played a role in consumer habits this month, BDO's September High Street Tracker monthly review stated. As it is not yet known if the U.K. will be leaving the European Union with or without a deal, both parliamentary and consumer attention is being dominated by the ongoing talks and action revolving around Brexit. "Political divisions have only become more entrenched as we get closer to Brexit crunch time, leaving little room to focus on more immediate policies that could help revitalize the U.K. economy," BDO's report read. "Businesses can be forgiven for feeling dizzied by the volatility that only intensified throughout the month. Consumers are also waiting for clarity, and the result of this wait-and-see approach appears to be a reduction in discretionary spending." However, despite this bleak report, there were some positives. Sales at fashion and lifestyle stores fell (by .6% and 2.1%, respectively), but homeware store sales were up by 5.3%. Additionally, digital continues to be a bright spot for stores, with non-store sales up by 12.4%, which helps bring the total decrease across channels up to .7%.