Independent retailers remain optimistic about their business prospects in 2014, the Association of Convenience Store’s (ACS) latest quarterly Voice of Local Shops survey has revealed.
Answered by 1,000 retailers in February, the Optimism Index showed its third consecutive quarter of improvement, with 26% of retailers saying they expected sales to rise this year.
ACS chief executive James Lowman said: “The third successive rise in the Optimism Index is an encouraging sign for the sector, and is backed up by improving wider economic indicators and the perception that convenience retailing is a growth market.”
However, the growth in optimism contrasts starkly with a sharp decline in actual sales performance compared to the last quarter.
According to the survey, 64% of retailers had experienced a decline in sales in the last three months, driven by the recent wet weather.
“Wet weather does not help local shops, and recent sales performer has taken a dip. Alongside rising cost pressures, this made for a tough Winter,” Lowman continued.
However, for the first time since the inaugural Voice of Local Shops survey in February 2012, retailers are reporting a better picture of cash profit than sales growth, though both these figures show net decline.
There is also an encouraging trend emerging on declining shop theft, with more retailers reporting no shop theft or a decline in shop theft. Community activity remains part of the vast majority of retailers’ work, with the North West and Scotland showing the highest levels of engagement in this quarter.
The survey showed that competition in the market was the most pressing issue for convenience retailers, but the impact of business rates was also a key concern, with almost one in four citing rates as one of the biggest obstacles to growth.