Big retail brands including Next, B&M and Greggs yesterday reported a sales boost over Christmas - despite rising prices, rail strikes and severe weather.
High Street giant Next said that year-on-year sales rose by 4.8% in the nine weeks to December 30 after a "dramatic boost" from the cold snap last month.
Greggs and discount chain B&M also performed better than expected.
Boots, which is owned by US firm Walgreens, said it had seen a "very strong" Christmas too, with demand up for its cheaper Everyday range of products.
The BBC says that some analysts suggested that customers were opting for cheaper options as prices continue to soar.
Next also warned that higher energy bills and mortgage rates would dampen demand from shoppers in the year to come.
Increase in prices
While it faces its own rising costs and supply-chain issues, Next confirmed that it will increase prices for its spring and summer clothes and home goods by 8%.
Shoppers will also see prices rise in the autumn and winter, the retailer said, but the increase will not be as sharp.
Next gave a "cautious" outlook for the year ahead.
Elsewhere on Thursday, there was more evidence that customers sought out cheaper treats on the High Street over the holidays.
Boots reported that retail sales jumped by about 15% in December when compared with one year ago with demand for its basics range up by a third.
Greggs said sales surged by nearly a quarter over 2022 as it added about 150 shops to its empire.
Huge demand
The bakery chain said that it had seen huge demand for its mince pies and festive drinks, as well as more customers looking to take advantage of offers on its app in a bid to save money.
Discount retailer B&M said that comparable sales rose across its shops by 6.4%, suggesting that more customers are prioritising value as prices continue to rise at their fastest rate for almost 40 years.
Russ Mould, investment director at AJ Bell, said that Greggs, B&M and Next are "united by having a presence on retail parks where business has been better than expected in general".
He pointed out that widespread train strikes in December will have prevented a lot of people from travelling to city-centre shops.
New figures from research firm Springboard also suggest that shoppers provided retail and hospitality firms with a much-needed boost ahead of Christmas.
Shopper footfall in December was up 5.8% on the month before and 9.9% higher than a year before.
'Pleasant surprise'
Next was one of the first major retailers to report on Christmas trade, and some experts have described the performance as "a pleasant surprise".
Mark Crouch, analyst at social-investing network eToro, told the BBC: "At a time when real incomes are coming under pressure, Next has managed to beat expectations."
But he also pointed out that Next now anticipates a drop in both sales and profits for the coming year.
"The retailer expects the real pain to come in 2023," added Mr Crouch. "Next is often seen as a bellwether of the High Street...you can guarantee many retailers will be in much-worse positions."