Period covered: February 17Published: March 07, 2017Read time: 1min

Retail Sales Monitor

FIRST NON-FOOD QUARTERLY DECLINE SINCE NOVEMBER 2011

Helen Dickinson OBE, Chief Executive, BRC: 

“Overall growth was subdued in February driven by a continuation of the slowdown in non-food sales. This was marginally offset by slightly stronger growth in food sales.

“There was some negative distortion created by the later timing of Mother’s Day this year, which meant that some categories, notably women’s accessories and health and beauty, didn’t benefit from the build-up of gift purchases as they did last year. But looking beyond this distortion, the persistent weak sales performance of several non-food categories points to an undeniable trend of cautious spending on non- essential items.

“Tougher times are expected ahead. The impact of inflation on consumer spending will add further intensity to an already fiercely competitive environment in which the ability to adapt and innovate will be key to survival. Looking to the Budget this week, we hope to see a commitment from Government to lay a path to a truly sustainable business rates system that will give retailers the flexibility needed to invest and support their local communities.”

Paul Martin, UK Head of Retail, KPMG: 

“Evidently February was yet another challenging month for the majority of retailers, with like-for-like sales down 0.4 per cent on last year. Food sales however, continued to buck the general trend by remaining in the black. That said, with inflation starting to have an impact on retail performance, it is clear that consumer confidence is showing signs of deteriorating.

“School half-term holidays are likely to have contributed to the stronger performance in children’s toy sales during the month. Likewise, furniture and home textile sales will have benefited from parents using the holiday as an opportunity to spruce up the home.

“Retailers will be paying close attention to the upcoming Spring Budget in the hope of seeing some measures to ease the pressure being placed on margins. For some bricks and mortar retailers, a hike in business rates may well be the straw that breaks the camel’s back.”

Food & Drink sector performance, Joanne Denney-Finch, Chief Executive, IGD: 

“Food and grocery turned in a solid sales performance throughout February, with a particularly strong Valentine’s Day this year.

“The return of a little inflation to the aisles is also playing its part and shoppers are bracing themselves for more to come: 81 per cent believe food prices will rise in the coming year, the highest level of anticipation since September 2016. This puts the emphasis back on hunting for value, with 63 per cent of shoppers favouring everyday low prices over more special offers.”