Sep 5, 2017
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Back-to-school and autumn product help UK sales rise says BRC

Sep 5, 2017

No sooner did we hear from Ipsos Retail Performance that retail footfall dropped across the UK last month than another key measure of retail strength actually showed sales rising during August.

Autumn ranges helped boost UK spending in August

The latest BRC-KPMG Retail Sales Monitor showed that back-to-school spending and enthusiasm for new-in fashion helped comparable sales rise 1.3% in August. That compared to a 0.9% dip in the same month a year earlier when the post-Brexit vote blues were still a major factor.

The BRC-KPMG report also said that total sales rose 2.4%, again better than a decline (0.3%) a year ago and also the strongest rise since Easter.

And in the three months to August, non-food retail sales rose 0.6% on a comparable basis and 0.9% in total, beating the 12-month average growth rate of 0.6%.

The sales monitor also showed non-food sales rising 11% online in August, again beating the three-month and 12-month averages.

But BRC chief Helen Dickinson was far from upbeat. “These figures tell a less positive story about the health of consumer spending than it might seem at first glance. Non-food sales have only just recovered to levels seen two years ago, after a dismal August in 2016. Stark challenges lurk around the corner for the retail industry,” she warned.

She added that consumer purchasing decisions are “very much dictated by a shrinking pool of discretionary consumer spend, with the amount of money in people’s pockets set to be dented by inflation and statutory rises in employee pension contributions in a few months’ time.”

But the big question is, how do the reasonably positive figures tally with the weak footfall to stores? As well as consumers buying more online, one option is that shoppers are making fewer stores trips but are buying more when they do venture out.

The internet is probably to blame/thank here too as research done online before shoppers even set foot across a store’s threshold means they know just what they should find there and exactly where to go as an alternative if the items concerned are out of stock. No more of the endless traipsing around stores that many of us remember from the last century.

What other factors could have been having an impact? Well, as mentioned, back-to-school shopping is key. Unlike in the US at present where the back-to-school season is spreading from early summer well into the autumn, it seems that UK parents are still cramming their shopping into August.

We may also have to thank the dull weather during last month. We’ve already heard from John Lewis that its shoppers were buying autumn outerwear in August with the dull, wet weather reminding them that the cold weather season was just around the corner. If replicated across the country, it could help wipe out the memory of some recent years when Indian summers in September have severely dented sales of knits, coats and jackets.

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