Verdict anticipates only a marginal improvement in their fortunes during the rest of 2006 as Q4 tends to be the quietest period for these sectors.
Looking ahead, the prospects for the rest of 2006 are positive and sales growth of 3.3 percent is estimated for this quarter against 1.9 percent for the same period last year.
While this spells good news in the short term, in 2007 a change in attitudes can be expected from consumers, bringing new problems for retailers.
November's rate rise will filter through to household incomes during Q1 next year, along with consumers having to contend with higher utility bills, initiating a slowdown in house price growth.
These factors, alongside the higher cost of servicing debt will conspire to produce a reorganisation of household incomes and a cutback on discretionary expenditure, resulting in a far more challenging trading environment in the New Year.
marketing@alchempro.com
