Retail sales slow as consumers turn to pre-loved gifts for Christmas

Retail sales during October grew by just over one per cent in value year on year, driven by inflationary pressures and masking falling sales volumes as shoppers bought fewer items per visit, British Retail Consortium (BRC) figures show.

It came as separate figures from Barclaycard also showed that card spending was up 3.5 per cent on last October – higher than September’s 1.8 per cent but well below the 8.8 per cent rise in consumer inflation.

The BRC-KPMG retail sales monitor for October revealed that total sales grew by 1.6 per cent over the month, compared with 1.3 per cent in the same period last year.

This is below the three-month average of 1.7 per cent and the 12-month average growth of 2.7 per cent.

Sales across almost every category online and in store fell year on year as consumers adjust to shrinking household incomes.

Furniture, food and health products saved the day on the high street as shoppers prepared for colder days at home but online retailers saw sales decline in every category apart from furniture as consumers headed to bricks and mortar shops more frequently in search of bargains.

BRC chief executive Helen Dickinson said some of the reasons behind the figures may be weather-related following milder conditions than normal at this time of year.

“With November Black Friday sales just around the corner, many people look to be delaying spending, particularly on bigger purchases,” she said.

“Clothing and footwear, which saw stronger sales this year, declined as the mild weather meant customers held back on buying winter outfits.

"Meanwhile, electric blankets, air fryers and other energy-efficient appliances continued to fly off the shelves as people sought future cost savings.

“Christmas will come later than last year for many and may be more gloom than glitter as families focus on making ends meet, particularly as mortgage payments rise.”

A poll by Barclaycard found that almost half of Britons (48 per cent) are planning to cut down on Christmas purchases, including festive activities and gifts, to save money this year.

Barclaycard, which sees nearly half of the nation’s credit and debit card transactions, found that spending on essential items such as fuel and groceries increased 5.7 per cent on last October, steeper than September’s 3.3 per cent in a reflection of the impact of rising inflation.

Fuel spending rose 17.7 per cent year on year, while supermarket shopping was up 4.6 per cent as the cost of food continued to rise.

In response, 67 per cent of Britons reported looking for ways to cut costs, with 48 per cent of these shoppers paying closer attention to the prices of items they buy regularly, and the same percentage buying budget or own-brand goods over branded goods.

Some 44 per cent are opting for cheaper “wonky” vegetables, and one in four (26 per cent) are only buying items that are discounted or on offer.

Spending on utilities was up 36 per cent but significantly lower than September’s 48 per cent increase as households started receiving their discounts from the Government’s Energy Bills Support Scheme.