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UK retail spend was sluggish in February say Barclays and BRC

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​Recent footfall reports showed low interest in shopping during February and now actual consumer spending and retail sales figures are coming out, backing up those reports.

On Tuesday the regular monthly Barclays consumer spending report and the British Retail Consortium-KPMG Retail sales monitor showed that February was the dullest month of the year not just because of the cloudy skies.

Looking first at the Barclays report, which covers a wide range of consumer spending offline and online, it said that spend grew only 1% year on year.

That was lower than the 1.9% growth seen in January and well below the latest CPIH inflation rate of 3.9%. 

Admittedly, discretionary spending remained in growth at +2.1%, but it still lagged that inflation figure.

Barclays said that “with warnings of increases in energy prices coming in the weeks ahead, consumers took the opportunity to get their financial priorities in order. As a result, essential spending declined in February”. But in something of a contradiction, it also said that “consumer confidence rose to record highs”. 

Confidence in household finances reached the highest level Barclays has seen since it started tracking this measure in 2015, at 75% (up from 70% in January), “bolstered by consumers’ careful money management, even in the face of rising costs”. 

Looking more specifically at retail, Barclays said the sector saw marginal growth of 0.6%, but was propped up by a surge in electronics sales, which enjoyed its greatest increase since 2021, up 6.7%.

Clothing transaction numbers rose 2.2% but actual clothing spend was up only 0.4%, suggesting consumers are still very price-conscious. 

And regarding specific types of retailers, department stores reflected that trend with transaction numbers up 2.8%, but actual spend only rising 0.6%. And discounters dropped almost 2% on both fronts.

Yet beauty continued to defy the sluggish spending trend with pharmacy, heath & beauty transaction numbers up just 0.2% but spend up 8.9%.

The BRC-KPMG report meanwhile talked of “grey days for fashion sales”. UK Total retail sales increased by 1.1% year on year in February, the same percentage by which they’d grown a year ago and still below inflation.

The Monitor’s assessment of non-food sales were that they were flat year on year in February, admittedly better than a decline of 2.7% in February 2024, but still far from making up the ground that was lost a year ago. 

In-store non-food sales actually decreased by 1% this time, but at least online non-food sales rose 1.9%. However, once again, this didn’t make up for the fall of a year ago when such e-sales had dropped 4.1%.

Helen Dickinson, BRC CEO, said: “Retail sales saw more modest growth in February. While sales growth across non-food categories was generally muted, it was propped up by online purchases, particularly in computing and electronics. Jewellery, watches and fragrance sold well thanks to Valentine’s Day, reversing declines seen last year. 

“Fashion performed poorly due to the gloomy weather throughout the month, but retailers are hopeful the early March sunshine kickstarts spending on spring and summer wardrobes.”

And Linda Ellett, UK head of consumer, retail & leisure at KPMG, added: “Consumers remain cautious with their spending and many are continuing to prioritise saving, travel and experiences. But occasions and offers are still tempting shoppers into some impulsive spending. Valentine’s, for example, brought a jewellery sales boost to the high street, in what was otherwise a flat month for in-store buying.     

“Online shopping and the growth of social commerce has contributed to a lowering of demand for some physical retail stores and boardrooms will continue to keep a close eye on monthly footfall and sales data as 2025 progresses.”

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Kering shares down 10% after Demna named Gucci designer

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March 14, 2025

Kering shares tanked on Friday morning after the group led by François-Henri Pinault chose to bet on subversive in-house talent Demna to reinvigorate its Gucci label rather than hiring a big-ticket name from fashion’s overheating job market. Shares fell by around 10% in early Paris session trade, underperforming French luxury peers, which were trading flat following the news.

Kering shares fall 10% after Gucci names Demna creative director. – Reuters

Analysts at Jefferies said the appointment of the Georgian former Balenciaga designer came as a surprise, while J.P. Morgan analysts called the move a “controversial choice,” citing early feedback on social media and fashion blogs and a “question mark” now hanging over the brand’s creative future.

The appointment of Gucci’s next design chief was the fashion world’s most-awaited news in recent weeks after Gucci fired Italian designer Sabato De Sarno after less than two years in the role.

The house’s prolonged sales decline, including a revenue drop of 24% in the fourth quarter of 2024 alone, has heavily weighed on Kering in the past months. Group shares are down around 40% year-on-year, while a European sector benchmark index is down close to 6% over the same period.

© Thomson Reuters 2025 All rights reserved.



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Seasalt to cut jobs as cost base rises

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Seasalt, the successful Cornish lifestyle-fashion brand, is considering a number of redundancies and it’s blaming higher taxes following the Autumn Budget that increased employers’ National Insurance contributions.

Seasalt

The company said the redundancy move was “in order to meet the challenges presented by an ever-changing retail industry” and that customer sentiment has continued to decline, impacting the outlook for trading conditions in the year ahead.

“As a business here at Seasalt, we are not immune to these very real concerns,” it explained. “In order to meet the challenges… the majority of those beyond our control, Seasalt must remain agile so that we can protect our business for the long term. 

“To continue investing in our growth plans, focusing predominantly on store and partners expansion, and large-scale projects to enhance our operations, we have thoroughly reviewed our cost base, to ensure our expenditure is not outpacing our sales and equally achieve the growth that is essential to the viability of our business. 

“This analysis has included looking at efficiencies and overall productivity, a transformation of our head office structure and a review of our retail team operations, along with, where possible, reducing the expenditure necessary to realise our sales growth.”

It all means a number of roles will be placed at risk of redundancy across the business.

The company has 76 stores around the UK and said in January that it had seen a big jump in sales for the festive season, despite it having to deal with major pressures on costs. Total sales, including stores, online, and partners such as M&S, Next and Zalando, were up 10% year on year in the final five weeks of 2024.

Back in May it had also filed accounts for 2023 showing turnover rising but some profit measures falling as investment and one-costs hit the figures.

It opened its first US store last year and plans two more in the short term.

The news on redundancies comes just after reports that its chief information officer Mel Wilcox has stepped down after less than two years. Drapers said she’s left “to seek new challenges and opportunities”.

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Shein exec finally says listing will happen, London still looks to be likely location

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Fast-fashion giant Shein has finally said that yes, it is planning a stock exchange listing and while it didn’t specifically say it would be in London, it hasn’t ruled it out.

Bloomberg

Shein’s listing ambitions have long been talked about and its original focus was New York. However, the welcome for a Chinese-linked company there was unlikely to be an enthusiastic one and the rumours since then have said London was the next-most-likely option, helped by the fact that the UK is one of the business’s top five markets.

Donald Tang, executive chairman of the now-Singapore-headquartered-but-Chinese-founded company told The Times in an interview conducted in London that a listing will happen. 

And while there has been some opposition from UK groups concerned about everything from its labour practices, to its fast-fashion profile and its secretive nature, Tang doesn’t appear to be afraid of the spotlight that a listing will shine on it.

He said Shein wants to list in order “to embrace the … accountability and transparency of being a public company”.

He added that the business is “democratising” global fashion, that it complies with laws in local markets and creates less waste than its rivals do because of the low inventory levels that it holds. He also cited research that shows its customers don’t view its products throwaway items to be worn just a few times.

Tang said he “admired” UK regulators for “a clear sense of separation between politics and regulation” and he also minimised concerns about Donald Trump’s plan to close the loophole whereby low-priced important into the US are tariff-free. 

He said he himself has advocated reform to create a “level playing field” and insisted that Shein’s success is because “we have a superior business model. We are about customers. We’re not about customs policy”.

The now 13-year-old company is believed to have filed paperwork for a potential London listing last summer, although the executive chairman didn’t confirm this and hasn’t mentioned any timing for a likely listing, nor the monetary value it would have.

But the company is already a member of the CBI, the major UK business organisation. That membership came, he told The Times, because “we want to be a globalised company. In London, we want to be a British company. We want to be a British local company … we’re registered here, we’re paying taxes here, we want to be part of a community.”

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