Glasgow-based fashion retailer Quiz has underlined how tough conditions are for sector players as it reported disappointing sales.

The company revealed that revenues fell around 12% in the two months to November 30, to £14.2m from around £16m in the same period last year. The period concerned includes the key Black Friday, which retailers have got used to relying on to provide a spur to sales.

Directors of Quiz said the fall continued a trend seen in the first half of its latest financial year. The surge in inflation and resulting increases in borrowing costs have prompted many consumers to cut spending in recent months.

The cut-backs come after years in which low interest rates allowed many consumers to use cheap credit to maintain free spending habits.

The fact that Quiz operates as a multi-channel retailer with online and bricks and mortar operations does not appear to have helped limit the impact.

While store sales fell by 6% to £9m in the two months to November 30, online revenues fell by 20% to £5.2m.

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The information in the update from Quiz suggests some consumers have effectively stopped spending on the kinds of goods it sells.

Quiz was able to pass on increases in the cost of products to maintain the profit margins achieved on the goods it did sell. The company is confident that its “differentiated occasion wear and dressy casual wear continues to resonate with consumers who are able to spend”. But the sales concerned did not allow Quiz to offset the impact of the fall in overall traffic which was seen in stores and online.

Quiz can take comfort from the fact that there are several weeks left of the key Christmas and New Year trading period.

However, it warned: “The near-term outlook is difficult to predict for many UK retailers including Quiz.”

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The effect of the pressure on revenues has been compounded by increases in overheads such as wages and energy.

While confident that Quiz has a future, directors are braced for the company to record a loss before taxation for the year “materially larger” than previous expectations.

The gloomy update from Quiz came on a day when the British Retail Consortium reported that growth in retail sales lagged inflation in November. The value of sales rose by 2.7% in November, up from 2.5% in October but down on the 12-month average of 4.1%.

The annual rate of retail price index inflation was 6.1% in October.

British Retail Consortium chief executive Helen Dickinson, said: “Black Friday began earlier this year as many retailers tried to give sales a much-needed boost in November. While this had the desired effect initially, the momentum failed to hold throughout the month, as many households held back.”

Paul Martin, UK head of retail at KPMG, said: “We are likely to see a prolonged and well targeted period of discounting as retailers compete hard for a shrinking pool of spend and will need to clear stock.”