To say that British retail institution Marks and Spencer (LSE: MKS) has endured a torrid time in trying to resurrect its ailing Womenswear range would be something of a colossal understatement. The business has ploughed vast sums into transforming its fashion ranges in recent years, including numerous revamps and overhauls of its design team.
So the retailer would have breathed a sigh of relief following last week’s trading statement, which showed like-for-like clothing sales rise 0.7% during January-March. This was Marks and Spencer’s best performance for four years and represents a stunning turnaround compared with the 5.8% slump recorded in the prior three-month period.
Customer spending on the charge
But ‘Marks and Sparks’‘ fashion revival is not just symptomatic of in-house innovations, such as the much-publicised introduction of its brand-spanking new suede skirt (due to hit the shelves this week, readers). Indeed, online specialist ASOS (LSE: ASOS) reported last week that group retail revenues surged 14% during September-February, driven by a stunning 27% uptick in UK sales to £231.4m.
There is no doubt that purchasing power on the British High Street — whether we are talking about physical, or virtual, ‘bricks and mortar’ — is categorically on the rise, a point underlined by the Office of National Statistics’ most recent retail sales data. This showed total till activity across the UK advance 0.7% in February and represented the strongest report since November.
Retail conditions set to improve further
Other clothing retailers such as Next (LSE: NXT) and Supergroup (LSE: SGP) have also recorded bubbly trading performances despite the adverse impact of unseasonal weather patterns more recently. Indeed, the former saw total sales leap 7.2% during the 12 months to January 2015, to £4.03bn, while the latter recorded a 17.8% surge in group sales during the three months to mid-January.
And the British retail sector is in broad agreement that consumer activity should continue ticking along nicely during the coming year at least. Indeed, Next noted last month that “the economic outlook for the UK consumer looks benign,” adding that “low price inflation, an end to real wage decline, healthy credit markets and strong employment all paint a more positive picture than in recent years.”
Against this backcloth I expect each of the FTSE giants mentioned in this piece to enjoy resplendent turnover growth well into the future.