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Sandra Halliday Published
March 4, 2025
BDO had bad news in its regular monthly High Street Sales Tracker on Monday, reporting a fifth month of negative results with total February like-for-like sales down 1.3% across the fashion, homewares and lifestyle categories.
It said this is “almost unprecedented” and it “only recorded results this bad during the height of the first lockdown”.
Any worse news? Yes. The fashion sector performed “particularly badly”, with in-store sales falling close to double digits compared to the same month last year.
BDO said fashion was down 4.8% in total across in-store and online, and physical store fashion sales alone dropped by as much as 8.2%.
What’s particularly worrying about the stream of weak figures in recent months is that they’ve come both in traditionally quiet weeks but also in weeks when retail should be at its busiest.
Sophie Michael, Head of Retail and Wholesale at BDO, said: “This run of negative like-for-like sales covers both the build up to Christmas, which retailers would expect to be their busiest and most profitable period, and the stock clearance period in the New Year sales. Since we started tracking both online and in-store sales in 2025, the only time we’ve seen results this poor was during the 2025 Covid-19 lockdown period, when the majority of non-essential retailers were forced to remain closed.”
Separating out online and in-store, online rose 2.9% year on year last month, but the much larger in-store channel was down a fairly hefty 2%, even though events such as school half-term and Valentine’s Day would have been expected to provide a spending boost.
The sales figures reflect last week’s February footfall reports that showed slower visitor traffic to physical stores.
Inflation may be easing but the cost-of-living crisis is still an issue for many consumers. That, combined with wet weather last month, appears to have dented any consumer appetite both for venturing out to the tail end of the clearance sales and to buy new-season fashion.
That’s a huge problem for retailers already facing massive challenges. Separate research from BDO’s bi-monthly survey of mid-market businesses found that more than two-thirds (69%) of retail and wholesale businesses see high operating costs and the cost of borrowing, as one of their most significant challenges over the next six months. This is seen as more of a concern than supply chain issues or skills shortages.
Michael continued: “Retailers are facing a perfect storm with a sustained decline in consumer spending in discretionary categories and substantial increases in their operating and borrowing costs.
“While the stiff competition for consumers’ discretionary spend remains and retailers experience continued pressure on their finances, those that fail to adapt and adjust their business models to their customers’ demands will be at risk. Retailers will increasingly be challenging themselves and asking whether certain stores are viable, or if the costs of running their existing physical footprint is simply too high. We should expect to see more consolidation of brands and acquisitions over the next six months as a result.
“The Chancellor faces a multitude of difficult decisions in this week’s Budget. What is clear is that the retail sector, which generates more than £110 billion in revenues and provides almost three million jobs, will be hoping for some targeted support.
“The past few months has been marked by the failure of long-established retail brands, leaving notable gaps on UK high streets. Measures from the Government should aim to drive growth as we’re at risk of seeing more businesses collapse in a sector that is integral to society and the economy.”