Next forecasts slow down in sales over Christmas
Next says delays in supply chains, lorry driver shortages and "pent-up demand" diminishing will lead to sales slowing down over the Christmas period.
The retailer said sales had risen by 14% in the last five weeks, but forecasted they would only increase by 10% by the end of the year. It said this was due to its supply chain being "compounded by labour shortages" in transport and warehouses.In a trading statement, the company said stock availability had improved, but remained "challenging".
It added prices rises in "essential goods" such as fuel might "moderate demand" and reduce sales growth through the festive season.Next said sales had increased 17% in the three months to the end of October compared with the same period in 2019.Steve Clayton, fund manager at HL Select said the "going is getting tougher" for Next, but said evidence suggested so far the company would "handle these issues better than most".
Chief executive Lord Wolfson has said labour shortages could be solved by companies hiring overseas workers and paying a "visa tax".Lord Wolfson suggested businesses could get visas for skills they "desperately need" and recommended that they should have to pay UK workers the same amount as overseas workers. To make this competitive, he argued businesses should have to pay a "visa tax on top - lets say 7% of wages".
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