British retailers are slashing prices and offering other deals in a bid to encourage reluctant shoppers to spend in the hope of staving off what could be the gloomiest Christmas in several years.

Shares in retailing companies slumped yesterday as general goods store Woolworths Group PLC expressed caution for the future, and the British Retail Consortium reported that likefor-like sales in November were up just 0.5% on last year — the slowest rate of growth since March — despite early discounting by several stores.

“High levels of promotional activity failed to drive the desired uplift,” the head of retail at KPMG, Helen Dickinson, said. “With a late surge, it’s all to play for, but the jury is out on whether the consumer will deliver.”

There was a glimmer of light with a report from retail research group SPSL showing that a Christmas rush to the shops may have started over the weekend, when several major stores held promotional sales, with shopper numbers up 7.6% on the weekend before and almost identical to the equivalent weekend in 2005.

“High-level awareness of short-term promotions certainly encouraged people out last weekend, seeking out what bargains retailers have to offer this Christmas,” a spokesman for SPSL, Tim Denison, said.

Tesco PLC, Britain’s largest supermarket chain, was also positive, reporting that sales grew 9.6% in the 13 weeks ended November 25, a performance slightly dimmed by falling prices for petrol in line with the international oil market.

Tesco Strategy and Finance Director Andrew Higginson said the company was “looking forward to having a good Christmas.”

However, the overall mood was downbeat.

The Retail Footfall Index showed that 7.3% fewer shoppers visited stores last month compared with November 2005, and retail analyst Richard Ratner of Seymour Pierce stockbrokers in London has warned that high street businesses remain on the brink of their worst Christmas trading period for 25 years.