The market research company understandably blamed the faltering housing market, higher costs of living, and concerns over further increases in energy prices for the drop. Confidence of women and those aged over 50 is particularly low. There was also a further fall in the number of people who think now is a good time to make a big purchase; that measure dropped to -37. For most, there seems to be little sign of any relief, with the growing spectre of the UK going into recession.

Highly geared

With the media full of such stories about hard-up shoppers and soaring inflation, it is hardly surprising that gloom and despondency is being replaced by a touch of panic in some retail boardrooms. The difficulty for many senior multiple retailers is that very few have traded through such a severe downturn. Most of those who had to deal with similar problems as recently as the early nineties are no longer involved and thus unable to share their experiences and offer counsel.

Already a number of highly-geared businesses have collapsed, and others will doubtless follow. But more soundly financed operations will know that whilst there will be a degree of pain, the downturn will not last forever. In the meantime, spending will, of course, continue, albeit at more modest levels as consumers cut back, either out of choice or necessity.

The lack of house moves has clearly had a negative impact on large ticket items. But for many a new television helps lighten the gloom. After a difficult June, John Lewis reported improvement the following month with "television volumes up very significantly on last year as a result of the price changes we have seen in the marketplace and our ongoing commitment to ‘Never Knowingly Undersold' (and a free five year guarantee)".

Weekly updates

John Lewis remains a bellwether of the high street. Government statistics are notoriously unreliable, trade organisation surveys are selective, and public companies can get away with issuing dated sales information and restrict themselves to bland statements about trading prospects. In contrast, John Lewis issues weekly sales figures by sector and location. There is no better or faster benchmark of a competitor's retail activity.

The first half of the Partnership's financial year ended on July 26 and the figures clearly illustrate the way consumers have cut back spending.

At the end of the first quarter (to April 26), turnover across its twenty-six department stores had risen year-on-year by 3.2%. For reporting purposes, the business is split into three main categories - ‘electricals and home technology' where sales had increased by nearly 8%, ‘fashion' was up by over 4%, and ‘home' which was down by three.

Now look at similar year-on-year comparisons at the end of July - total sales for the twenty-six weeks were only 0.6% up, though in the current climate its spokesman felt able to enthuse that the Partnership "can be delighted to be ahead of last year". For the half year, the increase in sales of ‘electricals and home technology' had dropped to just 1%, with ‘home' now 5% down, and only fashion (up by 5%) enjoying a decent second quarter.

On a monthly basis, ‘electricals and home technology' fell in May by over 5%, in June by 7%, but July was only 1% down, benefiting from an uplift during Clearance.

The group performance in the first half was in fact bolstered by two major resites, in Liverpool and Cambridge. The only others to have recorded sales growth over the six months were Aberdeen and London's Oxford Street store. Edge-of-town stores were particularly hit, with Cheadle, Brent Cross, Southampton, High Wycombe, Cribbs Causeway and Bluewater all down by 5% or more. In contrast, John Lewis's Internet business continues to thrive, with sales up by nearly a third in the half year.

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