Shoppers appear to be starting their Christmas shopping early, with retail sales higher this September than last – and 40% of transactions taking place online, the latest figures from the British Retail Consortium (BRC) suggest.
Retail sales grew by 5.6% in total in September compared to the same time last year, with 40.1% of sales taking place online, up from 30.8% a year earlier, according to today’s BRC-KPMG Retail Sales Monitor.
“September sales have given retailers early signs that consumers are starting their Christmas shopping earlier this year, which retailers are encouraging their customers to do in order to manage demand at Christmas and keep people safe,” said Helen Dickinson, chief executive of the BRC. “However, store-based sales, excluding food, are still in double digit decline.
“The industry is beginning to recover, however forced store or warehouse closures during any future lockdowns could put paid to this progress. Retailers have invested hundreds of millions in making their premises Covid-secure, with perspex screens, social distancing, additional staff and hygiene measures. The industry also provides essential employment for 3m workers in the UK and is already helping to contribute to the economic recovery.”
Last September, sales fell by 0.6% on the previous year in total. This September’s figure is the strongest since December 2009, once distortions from Easter sales – which can fall in a different month from year to year – are discounted. Like-for-like sales grew by 6.1% on a like-for-like (LFL) basis in September, compared to last September, when they had fallen by 1.3%. Areas that have benefitted from the rise include fashion and footwear - thanks to the return to school, and homewares.
Paul Martin, UK head of retail at KPMG, said the resilience of British retailers had been “remarkable” but said caution remained vital.
“This month’s uptick is against the woeful performance recorded in September 2019 and so caution remains vital. Last year, the prospect of a no-deal Brexit loomed over purchasing decisions, dampening demand but now that same prospect is accompanied by the recent resurgence of Covid-19 numbers. Combined, these factors could have a significant impact on retail growth over the next months.”
Susan Barratt, chief executive of grocery analyst the IGD, said food and grocery sales had picked up in September and there was evidence of some stockpiling in response to rising Covid-19 cases and possible further restrictions – but that this did not amount to the levels of panic buying seen in March.
She added: “Speculation concerning further lockdown measures and a possible no deal EU exit is leading to uncertainty among shoppers, with IGD’s Shopper Confidence Index remaining low but stable. Confidence continues to be lower among those aged 18-24 years old, a group that is traditionally more impacted during a recession.”
Food sales increased both in total (+5.6%) and on LFL (+5.1%). Non-food sales also grew, but growth in non-food retail sales was purely online, though the decline in in-store sales slowed last month. In-store sales of non-food items fell by 12.3% in total, and by 9.5% LFL in the three months to September. Online non-food sales, meanwhile, grew by 36.7%, well ahead of the growth of 3.5% recorded last September.
Both non-food and online are growing well ahead of the longer term trend. In the three months to September non-food sales grew by 5.2% LFL and by 3.2% in total – but in the 12 months to September non-food sales fell by an average of 5%.
Online sales grew by 39.7% over the three months to September, again, well ahead of the 12-month trend of 26.3%.
KPMG’s Martin said: “Online sales have eased slightly but it’s clear that the convenience of the channel is so well engrained into the consumer’s psyche now and is therefore here to stay.
“As we enter the all-important golden quarter – when many retailers make the majority of their annual revenue – the fight for survival couldn’t be more intense. Close attention has to be paid to how players choose to tackle key events, like Black Friday, within a consumer landscape that has changed entirely.”
via https://AiUpNow.com October 13, 2020 at 03:15AM by Chloe Rigby, Khareem Sudlow,
