BRC warns on lowest annual retail sales growth since 1995
The British Retail Consortium KPMG Retail Sales Monitor showed a 1.3% fall in retail sales in September, producing the survey’s lowest annual growth figure since 1995 of just 0.2%.
Like for like sales fell by 1.7% during the month and the three-month like for like non-food average fell by 3.2%.
‘With the spectre of a no-deal Brexit weighing increasingly on consumer purchasing decisions, it is no surprise that sales growth has once again fallen into the red. Many consumers held off from non-essential purchases, or shopped around for the bigger discounts, while the new autumn clothing ranges suffered from the warmer September weather,’ says Helen Dickinson BRC chief executive.
‘The longer-term prospect continues to be bleak, with the 12-month average once again plumbing new depths at a mere 0.2%. Online non-food sales growth was the lowest on record, though still compared favourably to the decline in growth at physical stores. With four months of negative sales growth since March, the ongoing political gridlock surrounding Brexit is harming both consumers and retailers. Clarity is needed over our future trading relationship with our closest neighbours, and it is vitally important that Britain does not leave the EU without a deal.’
‘Unsurprisingly September proved to be another difficult month for retailers. Worryingly, even online sales moved closer to stalling, with growth of non-food online sales only 0.7% Ongoing Brexit uncertainty is clearly having a material impact on the consumer psyche, with all but one non-food category being in decline in September. Consumers are choosing to focus on the essentials, with food one of the few categories delivering growth,’ says Paul Martin, KPMG UK retail partner.
‘We will likely experience increased promotional activity to clear surplus stock, which doesn’t bear well for retailers desperately trying to make up for lost ground after several difficult months. Retailers’ focus needs to be on cost and efficiency with only the leanest and most efficient operations coping with this extreme test of endurance. October, and the ramping up of Brexit plans, will clearly be a real test for the industry as a whole.’