Andrea Felsted is a Bloomberg Gadfly columnist covering the consumer and retail industries. She previously worked at the Financial Times.

If Next Plc's third-quarter trading update were displayed in one of its shop windows, it would be a scarf or necklace to decorate an outfit, rather than a show-stopping suit or party dress.

Full-price sales growth accelerated in the three months to Oct. 29, compared with the first and second quarters. But the 7.7 percent year-on-year fall in retail sales -- a significant miss to the consensus of analysts' expectations -- was unhelpful.

Diverging Fortunes
Next's online sales growth improved in Q3 but retail sales worsened
Source: Company reports, Bloomberg

Clothing demand has been volatile for a while now. Shoppers only buy a coat or a floaty dress when they need it, and that usually means when temperatures permit.

August and September were colder than the year earlier in the U.K. But October was warmer -- in contrast to cooler conditions a year ago. This was always going to dampen sales. So Wednesday's results shouldn't have been a surprise.

It helps to put the period in perspective. Next's report is no more than an accessory to the main outfit. The third quarter is a prelude to the crucial Christmas and New Year season, which can account for a significant share of non-food retailers' annual profits.

These months will be the key test of strength at Britain's clothing retailers.

Fashion Twins
Next and M&S's valuations have converged amid caution on consumers and the clothing market
Source: Bloomberg

Next is cautious. Given that it turned in a decent showing at the end of last year, the comparables are tougher. However it looks like it has addressed the missteps in its fashion choices, that hurt it a year ago. Indeed, sales perked up a bit at the end of last month. 

The shares were down as much as 8.6 percent, the most since January. That looks overdone, as do slumps in the shares of Marks & Spencer Group Plc and Debenhams Plc. 

As M&S prepares to report next week, investors should not rush to judgment ahead of the so-called golden quarter.

This column does not necessarily reflect the opinion of Bloomberg LP and its owners.

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Andrea Felsted in London at

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