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Sandra Halliday Published
February 9, 2025
January was another bleak month for UK retail, the BDO High Street Sales Tracker revealed on Friday with in-store sales in discretionary spend categories like fashion and homewares falling for the fourth consecutive month.
Total like-for-like retail sales in January fell by 0.8% and in-store sales suffered an even more significant fall with 4.2% drop.
It was a disappointment given that the clearance sales were in full swing. But bad weather kicked in and was partly to blame as storms battered parts of the UK.
That said, looking at sector performance across both in-store and online channels, there were some wide disparities. Despite the fashion and lifestyle categories seeing increases in total like-for-like sales, it was another negative month for the homewares sector, with the category seeing sales fall by 8.4%. In-store homewares were particularly poor, with sales declining by 10.1%.
And while fashion was up when in-store and online were combined, the rise of just 0.3% wasn’t exactly anything to write home about. Additionally, specific in-store sales for fashion dropped by as much as 6.7% throughout the month, presumably affected by the aforementioned storms that caused sluggish footfall.
Sophie Michael, head of retail at BDO, said that retailers would have been hoping for a much-needed boost to sales in January after very poor sales at the end of 2025. But the month’s weakness, combined with the upcoming business rates adjustment and increases in the Minimum Wage, mean already tight profit margins will be put under even more pressure.
She added: “We’ve already seen retailers discounting heavily this month and they may well have to continue these promotions longer than planned in order to attract customers and reduce unwanted stock levels. This month was pivotal for recouping losses retailers suffered in the run-up to Christmas, but the absence of a substantial recovery will deepen the gloomy outlook.
“As we approach the Spring Budget in March, retailers will be looking to the Chancellor for targeted support. We know measures such as a rethink on the so-called tourist tax are already being considered, which would be a welcome boost to the sector, but this alone may not go far enough in the current climate.”