How retail demand is showing signs of getting back on track

The British Retail Consortium (BRC)-KPMG Retail Sales Monitor reported that on a total basis sales increased by 1.3 per cent in October.

On a two-year basis, total retail sales grew 6.3 per cent during October compared with the same month in 2019.

Helen Dickinson OBE, inset, chief executive of the BRC, said: “Customer demand is getting back on track ahead of Christmas as sales grew at a faster rate than the month prior, and well above its pre-pandemic levels.

“As social calendars started filling up with festivities, clothing and footwear sales performed well.

“Meanwhile, furniture and electrical sales were held back by global logistical issues and microchip shortages.

“With Halloween heavily curtailed by the pandemic last year, chocolates and children’s costumes sold a treat as families made the most of the occasion.”

However, UK retail sales decreased 0.2 per cent on a like-for-like basis from October 2020, when they had increased 5.2 per cent, the sales monitor showed. This was below both the three-month average growth of 0.3 per cent and the 12-month average growth of 10.6 per cent.

Ms Dickinson said: “Some people started their Christmas shopping early with beauty advent calendars flying off the shelves and searches for Christmas items ramping up online.

“Retailers are doing everything they can to offer customers the choice and availability required throughout the industry’s busiest period, prioritising the food and other festive products needed to celebrate.

“Retailers are hopeful that demand will continue right through the golden quarter. However, there are challenges ahead with higher prices on the horizon compounded by the many increasing costs faced by consumers such as higher energy bills and rising national insurance.”

Paul Martin, UK head of retail at KPMG, said: “Confident consumers are heading to physical stores to make purchases, as online sales fell yet again in October, although with penetration rates at 42 per cent online shopping remains significantly higher than pre-Covid-19 levels. The much reported squeeze on household spending has yet to materialise as consumers seem happy to carry on shopping.

“Limited availability of stock has created strong pricing dynamics, which means we are unlikely to see any big discounting this Christmas, and many retailers will be hoping consumers are willing to buy the most sought-after gifts at any price.”

Online non-food sales decreased by 8 per cent in October, against a growth of 39 per cent in October 2020.

Over the three months to October, food sales increased 1.5 per cent on a total basis and 0.3 per cent on a like-for-like basis. This was below the 12-month total average growth of 4.7 per cent..

Susan Barratt, CEO of Institute of Grocery Distribution, said: “The food and drink sector saw another muted performance in October, with sales down versus 2020, when shoppers stocked up ahead of the lockdown in November.

“Preparations for Halloween 2021 offered a slight boost to performance, though the actual day fell out of the reporting period.”

---

Support The Yorkshire Post and become a subscriber today.

Your subscription will help us to continue to bring quality news to the people of Yorkshire. In return, you'll see fewer ads on site, get free access to our app and receive exclusive members-only offers.

So, please - if you can - pay for our work. Just £5 per month is the starting point. If you think that which we are trying to achieve is worth more, you can pay us what you think we are worth. By doing so, you will be investing in something that is becoming increasingly rare. Independent journalism that cares less about right and left and more about right and wrong. Journalism you can trust.

Thank you

James Mitchinson