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Abu Dhabi, UAEMonday 18 June 2018

UK retailers hope for pre-Christmas 'Super Saturday' to boost ailing sales

British shoppers are expected to spend £1.4billion (Dh6.9bn) on “Super Saturday”, two days before Christmas Day

Shoppers carry bags as they do their Christmas shopping on London's Oxford Street. Simon Dawson / Reuters
Shoppers carry bags as they do their Christmas shopping on London's Oxford Street. Simon Dawson / Reuters

British retailers are hoping a last-minute rush to the shops before Christmas will help boost the UK’s ailing retail sector after a weaker than expected lead up to the festive trading period.

Shoppers are expected to spend £1.4 billion (Dh6.9bn) on “Super Saturday”, the last Saturday before Christmas, which falls on Monday.

Estimates by retail analysts ShopperTrak expect Britain’s high street stores to be up to 65 per cent busier than average.

“With fears [that] online orders will not reach consumers before Christmas Day, shoppers will step out from behind their screens and take to the high street to finish off their festive gift buying in physical stores,” said Steve Richardson, UK and Middle East and Africa director at ShopperTrak.

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Sunday trading laws in the UK mean larger stores usually close around 4pm (8pm GST) and so shopper traffic will be busier on Saturday. But Christmas Eve is still expected to be up to 35 per cent busier than an average day.

High street stores are hoping for an extraordinary weekend of spending after a cold snap last weekend kept many consumers at home.

British retailers have seen a “weaker than expected” Christmas season this year, according to the Confederation of British Industry (CBI).

“Notwithstanding the sales growth seen in the last couple of months, underlying trading conditions are tough for retailers," CBI economist Alpesh Paleja said. "We expect the squeeze on real pay for households to last a while longer, so retailers will still face challenging conditions ahead."

The UK economy has slowed in 2017, in part due to the rise in inflation following the result of the 2016 Brexit referendum, with stalling incomes putting a squeeze on household budgets.

Toys R Us is facing an uncertain future despite being saved from administration this week. Andy Rain/ EPA
Toys R Us is facing an uncertain future despite being saved from administration this week. Andy Rain/ EPA

British retailers have felt the impact of the Brexit vote too; a weak pound has led to higher import costs, forcing stores to make the choice between absorbing higher prices themselves or risk alienating consumers by rising prices.

Toys R Us, the US chain which has 105 stores in the UK, almost went into administration in Britain the week before Christmas, as a result of tough market conditions and waning sales.

The retailer was saved by an 11th hour rescue deal on Thursday, when creditors backed its plan to invest £9.8m into its pension fund over the next three year. However, 26 stores will close in the new year, putting 800 jobs at risk.

Meanwhile traditional department stores such as stalwarts of the British high street John Lewis and Debenhams are also struggling, raising the possibility of further redundancies in the retail sector in 2018.

“Department stores are in for a poor Christmas because of the structural pressure they’re under,” Tony Shiret, an analyst at Whitman Howard, told the Financial Times.

“It’s the backdrop that’s killing them, rather than the current trade. They don’t have the margins they used to, which makes the odds [of an upset] higher.”