By Daniel Hunter

The UK high street held its head above water in January, growing 0.2% year-on-year. While the rise recorded by BDO’s January High Street Sales Tracker was meagre, many retailers are likely to be greatly relieved.

Set against an exceptionally strong January in 2011which registered a 9.1% increase on the previous year (the strongest monthly performance of 2011) driven by shoppers going on a spree to beat the VAT rise - growth of any sort will be seen as a positive by store bosses.

Both homewares (+1.6%) and non-fashion (+2.4%) saw like for like, year-on-year sales rise, with the latter buoyed by strong performances from luxury retailers.

Don Williams, National Head of Retail and Wholesale at BDO LLP, said there was anecdotal evidence some luxury stores had steered clear of discounting until after Christmas to avoid “sale fatigue” in consumers and encourage them to seek out bargains after the Christmas spending rush.

Fashion saw a slight (-0.8%) drop overall, but some stores managed to take advantage of the cold weather to clear winter lines. Others cited new season stock and extended promotions as factors which helped them steal a march on rivals.

“Overall, these figures are better than expected,” said Williams, “but behind the numbers we are seeing an increasing polarisation in the performance of high street retailers. Those that are offering consumers what they want, with new products and value, backed by superior service, are seeing weeks where their year-on-year growth tops 75%.

“Those retailers that are not reacting quickly enough to their customers’ demands are seeing falls of 75%. There is no longer such a thing as an average retailer and the chasm between the high performers and the strugglers is widening every month.”

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