October sales growth best in last 6 months
Posted on 17 Nov 2009
Like for like cycle retail sales growth increased to 7.3% in the specialist sector in October, the highest growth rate in the last 6 months and nearly double the 3.8% the British Retail Consortium reported for total UK retail sales growth in October. A higher growth rate was anticipated as cycle shop sales fell in October 2008 as the economic problems impacted upon consumer confidence.
Underlying retail sales in the specialist cycle sector have grown by 4.4% year to date, this excludes the growing volumes of bicycle sales being generated via Cycle to Work schemes. It will be interesting to compare this growth rate against Halfords results due to be announced later this week.
Halfords remain the largest individual cycle retail business in the UK with a market share of c27% and their highly rated CEO, David Wild continues to claim that Halfords are growing market share in their ‘strong markets'. However, analysis of Halfords sales figures released over the past year reflect a short fall in performance vs.the specialist sector's growth, despite inclusion of cycle to work sales in Halford's figures.
The weather remains relatively mild, cycle stock shortages are being addressed and retailers are benefiting from the ongoing impact of retail sales price inflation. Continued growth seems assured in the short term, especially in November when sales fell in 2008 vs. 2007.
October Cycle Retailer Fact File
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October like for like core sales increased 7.3% vs. 2008 (Sep 0.8%; Aug 3.7%; Jul 5.8%; Jun 2.2%; May -7.1%; April 19.4%; Mar 22.6%; Feb -9.7%; Jan 0.8%)
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34% of retailers reported sales UP by more than 20% in October 09 vs. 08 (September 31%; August 30%; July 23%)
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9% of retailers reported sales UP by between 10% - 20% in October 09 vs. 08 (September 9%; August 15%; July 15%)
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16% of retailers reported sales UP by between 1% - 10% in October 09 vs. 08 (September12%; August 14%; July 15%)
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11% of retailers reported sales DOWN by between 1% - 10% in October 09 vs. 08 (September 16%; August 11%; July 17%)
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9% of retailers reported sales DOWN by between 10% - 20% in October 09 vs. 08 (September 12%; August 13%; July 13%)
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21% of retailers reported sales DOWN by more than 20% in October 09 vs. 08 (September 20%; August 17%; July 17%)
The challenge for the specialist retailing remains the performance split across the sector. The market continues to polarise as ActSmart has reported throughout the past year and the October figures show no sign of change.
The overall increase in the growing businesses was 23.1% vs. October 08 (September 22.5%; August 22.6%; July 26.2%)
The overall decrease in the shrinking businesses was -22.2% vs. October 08 (September -19.7%; August -18.3%; July -17.7%)
The specialist cycle retail sector is strong and growing, but the performance mix across the market is of increasing concern.
The Wider Picture
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2009 year to date like for like core sales growth is 4.4%
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Quarter 1 2009 like for like sales growth was 5.8%
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Quarter 2 2009 like for like sales growth was 3.7%
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Quarter 3 2009 like for like sales growth was 3.5%
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Last 3 months like for like sales growth is 3.7%
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Retail Finance sales via the ActSmart scheme have grown by over 29% YTD
Market research figures were derived from 280 specialist cycle retail businesses and workshops throughout the UK, representing c335 shop fronts ranging in size from annual turnovers of £25k to £3m. The performance figures apply to core like for like retail sales only; they do not include sales achieved via retail finance, cycle to work schemes or other non-core sales transactions, which will increase growth rates accordingly. No internet/mail order only businesses participated in this research.
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