Subdued environment highlights challenges for high street

ON UK INCOME

As the New Year begins and television adverts quickly change to prompt us to get healthy, having encouraged us to indulge just a few days earlier, in equity markets we learn just how successful retailers were in persuading us to spend over the festive season.

The negative response to Tesco’s dip in sales shows just how anxious investors are about the level of that success. Tesco issued a profit warning on 13 January, sending its shares down 16% in one day. The subdued consumer environment is highlighting some of longer-term challenges facing many high street operations. These include smaller, specialist businesses where competition in their industry is fierce and they may also be losing share to larger multiline retailers, such as Barratts Shoes in footwear, La Senza in underwear, Blacks Leisure in outdoor merchandise and Thorntons in conf...