October UK retail sales see small bounce, led by fashion, but overall picture is bleak
UK retail sales saw a surprise rebound in October, official figures from the Office for National statistics showed on Friday. The ONS said that retail sales volumes are estimated to have risen by 0.6% in October compared to the previous month, following a fall of 1.5% in September.
However, it has to be said that September was an unusual month, given the extra public holiday on the day of the Queen's funeral and the impact of her death on consumers and stores in the preceding week-and-a-half.
Looked at on a year-on-year basis, the volume of retail sales was actually down 6.1% in October.
The value of retail sales rose 1.8%, compared to the previous month and 4.8% compared to the previous year, but with inflation running close to double-digits, it was clear that unavoidable price rises accounted for all of this gain and those volume falls show that retailers are still in a tough position.
Looking purely at volumes and on a month-on-month basis, increases were seen in all of the main sectors apart from food stores. Non-food stores sales volumes rose by 1.1%, although as mentioned, the comparison with September was a tricky one and they were still 1.7% below February 2020 pre-pandemic levels.
The ONS said that clothing stores sales volumes rose by 2.5% month on month but were 3.7% below their February 2020 levels. And department stores volumes fell by 0.3%.
Non-store retail (predominantly online retailers) sales volumes rose by 1.8% in October following a fall of 2.5% in September and were 21.2% above their February 2020 levels. The proportion of retail sales taking place online was 26.1%, a broadly consistent level since May 2022.
Online sales of textiles, clothing and footwear were down 8.4%, compared to a year ago and down 2.7% compared to September, while department store sales online were down 6.8%, compared to a year ago and 1.7% against the previous month.
Jacqui Baker, partner and head of retail at audit, tax and consulting firm RSM UK, said: “Although there was an uptick in retail sales last month, driven by clothing, it’s hard to ignore what’s likely to be a bleak winter ahead. Consumers are looking at how they can tackle the fallout from the cost-of-living crisis in their spending decisions.
“Despite the cost-of-living allowance given to consumers last month to offset the energy price cap increase, there’s still little sign of early Christmas cheer for retailers. This has led to many not being able to hold their nerve and starting offers early.
“The upcoming World Cup, Black Friday and Christmas may offer a temporary respite, but the question is are these just sticking plasters? Retailers will be banking on Black Friday in particular to shift their excess stock. But with stalling demand, Black Friday probably isn’t going to be the panacea many cash-strapped retailers are hoping for.”
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