Next has poured cold water on the prospect of a festive season sales boom after warning that supply chain problems and shortages of lorry drivers and warehouse staff would hold back growth.
The retailer posted a 14pc increase in sales in the past five weeks compared to the same period pre-pandmeic, but flagged a slowdown in trade for the rest of the year.
Factors including labour shortages and the wider supply chain disruption, as well as dwindling pent-up demand and frail consumer confidence, would mean a sales increase of just 10pc in the next quarter, Next said.
Stock availability had improved but remained “challenging”, the company said. It warned that price rises in “essential goods” such as fuel might “moderate demand” and lower sales growth through the festive season. “The effects of pent‐up demand are likely to continue to diminish.”
Nevertheless, Next maintained its full-year profit guidance of £800m as it posted a 17pc rise in sales in the three months to October 31 compared with the same period in 2019.
Online sales were also up by almost 50pc in the year to October, boosted by third-party brand purchases, while in-store sales were down close to 30pc.