The fashion sector experienced a reversal in October as sales began to recover, offering a glimpse of market stability.
- Shop price deflation reached 0.8% in October, showing a slight increase in fashion prices, a first since January.
- Non-food deflation persisted at -2.1%, maintaining a consistent rate compared to previous months.
- Food inflation eased, descending to 1.9% from 2.3% in September, impacting overall shop price inflation.
- Retail experts urge for fiscal adjustments to aid the sector, amidst growing competitive pressures.
In the latest reports, the fashion industry displayed signs of recovery during October, breaking a trend of discounted sales with a modest increase in prices. While shop price deflation was measured at 0.8%, this shift indicates a stabilisation within the sector. The BRC-NielsenIQ Shop Price Index highlighted these changes, noting that while overall deflation is easing, the fashion market’s adjustment marks a notable development.
At a 0.8% rate, shop price deflation was marginally below the three-month average of -0.6%. This uptick provided a hint of optimism as retailers gently increased prices for the first time in months, lifting from a prolonged period of aggressive discounting.
Despite these improvements, the non-food segment maintained its deflation at -2.1%, consistent with figures reported the month prior. This steady rate remains under the longer average of -1.9%, signalling ongoing price competition.
Food inflation presented another dimension, declining from 2.3% in September to 1.9% in October. This decrease, while still above the three-month average, contributed to a broader reduction in shop price inflation overall.
Helen Dickinson from the BRC indicated that these developments are promising for the fashion industry, marking the first price rise since January. Meanwhile, the organisation has called upon the Chancellor to implement measures that would lower business rates, supporting retail property and encouraging investment.
According to Mike Watkins of NielsenIQ, easing food supply chain inflation has helped to mitigate shop price pressures. However, with the festive season approaching, competitive strain for consumer spending is anticipated to heighten. Retailers are gearing up for this intensified market environment.
October’s developments suggest a cautious optimism for the fashion retail industry as it navigates challenges with emerging market trends.
