Retailers predicting growth during the Christmas period

Christmas spending is expected to increase this year. Christmas spending is expected to increase this year.

November is the time of year when businesses and consumers shift up a gear, trying to get presents and gifts sorted for the holiday period. The optimism has already become evident among retailers, with a considerable majority expecting increased sales, according to research from Deloitte.

The research firm's most recent survey of retailers has found that 75 per cent are expecting sales to outstrip last year. Most organisations that predicted growth are expecting an increase of between 2 and 5 per cent.

While companies are forecasting greater sales volumes, the report suggested they are not going to undertake the same discounting that has been seen in previous years. In fact, 49 per cent expect to increase their margins over the Christmas period, although three-quarters are still expected to offer reduced prices.

Online sales for the Christmas period have also increased rapidly, with a growing number looking to e-commerce as a tool for driving greater growth in the sector over the next few weeks. In fact, 83 per cent of retailers are expecting higher online sales over the holidays, suggesting that digital technologies are increasingly important for retailers.

The leader of Deloitte's Retail, Wholesale & Distribution Group, David White, suggested the conditions were right for a strong end to 2014 and start to 2015.

"Despite relatively flat consumer sentiment, low interest rates and cheap credit are helping to boost consumer spending and retailer confidence in the lead up to Christmas," he stated.

"There [also] appears to be genuine optimism about 2015. Compared to last year, there has been a 15 per cent fall in the number of retailers concentrating on efficiency and cost control. Instead we are seeing a greater focus on organic growth, particularly through bricks and mortar stores and a greater investment in multi-channel offerings."

Of course, quickly moving stock for the Christmas period also puts a greater strain on suppliers, with an increasing number of invoices to meet these demands. Tools like debtor finance can be useful here, as they allow companies to focus on filling increased orders, without spending all of January chasing up invoices.