UK retail sales rise, fashion soars as life returns to normal
March UK consumer spending held up well, a new report said on Friday, and fashion “soared” above other sectors as consumers renewed their wardrobes for the spring season.
That’s according to BDO’s High Street Sales Tracker (HSST), which said that March saw the 13th consecutive month of retail sales growth, a new record. Year-on-year total like-for-like sales (that’s in-store and online) were up 60.9%, although the fact that the UK was in full lockdown a year earlier would have had a big impact in 2021.
The change over the course of last year can be seen very clearly from the fact that non-store like-for-like sales fell via 10.8%, the third month of decline in this area. In March 2021 by contrast non-store sales were up over 157%.
So what about fashion specifically? Total like-for-like sales rose 87% for the month, from a base of +57.5% for the same time last year. Fashion was also the only category to record positive non-store results in March.
Combined with other information – such as Kurt Geiger saying that the multi-year trend away from high heels has gone into reverse in recent periods and several retailers highlighting increased searches for swimwear – the fashion figures in March suggests that consumers really are embracing the opportunities now available to them.
Special events such as weddings and other dressy occasions are happening in large numbers and consumers also seem to have overcome their nervousness about contact with others and are socialising more actively again. Holidays are also back on the agenda. It's all helping fashion sales, as is the acceleration of the return to workplaces.
While both fashion and lifestyle categories saw substantial sales, homewares saw its first fall since April 2020.
On a weekly basis, cross-category sales in the first week of the month saw growth of 48.31% from a base of +4.53% for the same week the previous year. And the second and third weeks of the month saw increases of 60.87% and 94.31% respectively. In the final week of March, the rise was 76.13%.
Sophie Michael, Head of Retail and Wholesale at BDO, said: “Our results in March have highlighted that consumer spending remains high despite impending increases to the cost-of-living this month. However, there are also concerning signs that some of this spending is being supported by record levels of household borrowing, which has increased lately even as consumer confidence plummets. There may be good reason to expect some pull-back in discretionary spending over coming months, though the impact will inevitably vary across different areas of retail.
“Rising energy, operational and supply costs also pose a serious challenge for retailers, many of whom may look into raising prices and/or re-examining their supply chains, as they seek to mitigate these issues and make cutbacks where possible. While the cost-of-living crisis was largely still on the horizon in March, retailers have been planning ahead and have made allowances for higher levels of inflation. However, the forecasts only appear to be increasing so the question is whether costs will rise faster than initially anticipated and cause further disruption.
“This myriad of issues will no doubt require retailers to reconsider their plans as the consumer purse comes under increasing pressure.”
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