Covering the four weeks 29 October – 25 November 2023

• UK Total retail sales increased 2.7% in November, against a growth of 4.2% in November 2022. This was above the 3-month average growth of 2.6% and below the 12-month average growth of 4.1%.

• Food sales increased 7.6% on a Total basis over the three months to November. This is below the 12-month average growth of 8.4%. For the month of November, Food was in growth year-on-year.

• Non-Food sales decreased 1.6% on a Total basis over the three-months to November. This is below the 12-month average growth of 0.5%. For the month of November, Non-Food was in decline year-on-year.
  
  
• Over the three months to November, In-store Non-Food sales decreased 0.8% on a Total basis since November 2022. This is below the 12-month average growth of 0.6%.
  
  
• Online Non-Food sales decreased by 2.1% in November, against a decline of 0.4% in November 2022. This was shallower than the 3-month decline of 2.8% and deeper than the 12-month decline of 3.0%.

• The proportion of Non-Food items bought online (penetration rate) decreased to 41.4% in November from 41.6% in November 2022.

Helen Dickinson OBE, Chief Executive of the British Retail Consortium, said:
“Black Friday began earlier this year as many retailers tried to give sales a much-needed boost in November. While this had the desired effect initially, the momentum failed to hold throughout the month, as many households held back on Christmas spending. Health and beauty products showed stronger growth, but non-food sales were down overall year on year. November had the highest proportion of non-food goods purchased online for 2023, though this remains below the previous years’ level.

“Retailers are banking on a last-minute flurry of festive frivolity in December and will continue working hard to deliver an affordable Christmas for customers so everyone can enjoy some Christmas cheer. Looking ahead to 2024, retailers will have to shoulder many new cost pressures, including a rise to business rates, as well as costs from other new regulations. These combined with the biggest rise on record to the National Living Wage will mean retailers will have less capital to invest in lowering prices for their customers.”

Paul Martin, UK Head of Retail, KPMG, said:
“With the clock ticking down to Christmas, sales growth in November remained weak at 2.7%, despite a big push from retailers around Black Friday deals.

“Food and drink, health, personal care and beauty categories continued to drive growth whilst jewellery and watches saw the biggest decline in sales on the high street, suggesting consumers are abandoning expensive presents in favour of more budget friendly gifting.  Online sales fell yet again, but penetration rates rose by 5% on October to 41.5% as consumers shopped around for Black Friday bargains.

“With less than a month to go and sales growth limping along, the cost-of-living crisis has taken its toll on Christmas spending for many households, and the continued economic conditions are testing consumer resilience.  Price remains the main purchasing driver, so we are likely to see a prolonged and well targeted period of discounting as retailers compete hard for a shrinking pool of spend and will need to clear stock.

“With two of the three months of the crucial golden quarter seeing sales growth below 3%, it has already been a weak Christmas trading period.  Any excess stock not sold before Christmas could be further reduced leading to big January sales, and potentially having an even greater impact on already tight margins.  As we look to the first few months of 2024, we can expect the challenges to continue which could lead to further casualties in the sector, particularly pure online players facing more than 28 months of consecutive sales decline.”

Food & Drink sector performance | Sarah Bradbury, CEO, IGD, said:
“For a second month in a row, food and drink sales were down in November compared to October. The comparatives to November ’22 paint a slightly better picture with an increase in sales, although this was offset by a marginal decline in volume. Footfall for the month was down compared to November ’22, a likely result of storms Ciarán and Debi bringing wetter and more windy weather across the country.

“IGD’s Shopper Confidence Index enjoyed a slight rise in November, driven primarily by a rise in confidence among the lowest income earners. This group were likely boosted by plans for the national minimum wage to rise announced by the government in the Autumn Statement. Although lower income earners still expect to be ‘about the same’ financially next year, rather than actively better off. Trust in the industry rose again, with 30% now trusting the food and consumer goods industry to keep prices low, compared to 24% in October ’23. This is likely to continue further if general sentiment continues to improve.”