Retail Sales Monitor

First Signs of an Early Christmas

  • Anne Alexandre avatar
    Anne Alexandre RSM Manager | BRC
  • James Hardiman avatar
    James Hardiman Analyst | BRC

Helen Dickinson OBE, Chief Executive, BRC: 

“September saw a big improvement in retail sales growth, however sales over the last six months are still down on the previous year. Tighter coronavirus restrictions have continued to hold back clothing and footwear, particularly as the Government further restricts social events. With office workers still at home for foreseeable future, the sales of electronics, household goods and home office products have remained high. September sales have also given retailers early signs that consumers are starting their Christmas shopping earlier this year, which retailers are encouraging their customers to do in order to manage demand at Christmas and keep people safe. However, store-based sales, excluding food are still in double digit decline.”

“The industry is beginning to recover, however, forced store or warehouse closures during any future lockdowns could put paid to this progress. Retailers have invested hundreds of millions in making their premises Covid-secure, with Perspex screens, social distancing, additional staff and hygiene measures. The industry also provides essential employment for three million workers in the UK, and is already helping to contribute to the economic recovery.”

Paul Martin, Partner, UK Head of Retail, KPMG: 

“The resilience of British retailers has been nothing shy of remarkable in recent months, with 6.1% like-for-like growth in September serving to reinforce that.

“That said, this month’s uptick is against the woeful performance recorded in September 2019 and so caution remains vital. Last year, the prospect of a no-deal Brexit loomed over purchasing decisions dampening demand, but now that same prospect is accompanied by the recent resurgence of COVID-19 numbers. Combined, these factors could have a significant impact on retail growth over the next months.

“Looking at the performance of specific retail categories, it’s clear that ‘Back to School’ activity gave fashion and footwear retailers a much-needed boost from lacklustre performance. Elsewhere though the focus remains on home-related items, including household appliances, furniture and technology. Online sales have eased slightly, but it’s clear that the convenience of the channel is so well engrained into the consumer’s psyche now and is therefore here to stay.

“As we enter the all-important ‘golden quarter’ – when many retailers make the majority of their annual revenue – the fight for survival couldn’t be more intense. Close attention has to be paid to how players choose to tackle key events, like Black Friday, within a consumer landscape that has changed entirely.”  

Food & Drink sector performance, Susan Barratt, CEO, IGD: 

“Food and grocery sales picked up again in September following a relative slowdown in August. The end of the Eat Out to Help Out scheme combined with local lockdowns, has resulted in shoppers increasing their spend in retail. Furthermore, late September has seen some stockpiling as shoppers react to rising COVID-19 cases and possible further restrictions, although this is far from the level of panic buying experienced in March.

“Speculation concerning further lockdown measures and a possible no deal EU exit is leading to uncertainty among shoppers, with IGD’s Shopper Confidence Index remaining low but stable. Confidence continues to be lower among those aged 18-24 years old, a group that is traditionally more impacted during a recession. Local lockdowns are also denting confidence among shoppers in the West Midlands and Wales.”

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