DEPARTMENT store chains John Lewis and Liberty have both reported strong sales over the Christmas period, but retail leaders have warned that the short-term boost may not signal a turnaround for the sector.
Luxury retailer Liberty said yesterday that its Christmas sales were close to record levels as trading surpassed management hopes, while John Lewis – which has three stores north of the Border – said it was encouraged by its festive performance after
total sales rose 2.4 per cent in the five weeks to 3 January.
John Lewis said fashion sales, including beauty, were 4 per cent higher, while electricals and home technology improved by 10 per cent.
Sales for the home department were impacted by the property downturn, but the retailer said the division saw stronger trade last week as bargain-hunters came out in force.
Howard Archer, chief UK economist at IHS Global Insight, said: "Unfortunately, though, the improvement in John Lewis' sales in the final run-up to Christmas and the early days of the clearance sales is highly unlikely to mark the start of an improving trend."
The company, which trades from 27 stores and an online division, reported its biggest ever day on 27 December for the start of its clearance sale.
Liberty, which benefits from its prime location on London's Regent Street, is likely to have been boosted by foreign tourists taking advantage of the pound's weakness.
While hit by the general retail squeeze in November, Liberty said December trading "almost matched last year's record Christmas" as the firm also cleared stock ahead of a major store overhaul.
The firm, which is owned by Marylebone Warwick Balfour (MWB) – the property firm that also owns the upmarket Malmaison and Hotel du Vin hotel chains – said it was also helped by its e-commerce business, which showed "particularly significant" growth over the month.
But sales from its stand-alone luxury brands store on London's Sloane Street were lower than expected in the period since its launch last year as the new venture attempts to gain market share in a tougher retail environment.
The company said trading at its two hotel chains had been firm during 2008 with earnings and cashflow targets ahead of the previous year.
The group held occupancy and room rate for the year at 79 per cent and £115 respectively, although food and drink takings were marginally down in worsening trading conditions.
Despite the more difficult climate, MWB opened four new hotels during the second half of last year – in Edinburgh, Aberdeen, Poole and Newcastle.
The group said all the new hotels had been trading well since opening, taking the Malmaison chain to 12 hotels and Hotel du Vin to 14.
Last month the group's hotel at St Andrews, the St Andrews Golf Hotel, received planning consent for conversion to a Hotel du Vin, although it continues to trade in its existing format in the meantime.
