Retail Sales Monitor

Sales Improve as Retail Outlook Brightens

  • James Hardiman avatar
    James Hardiman Analyst | BRC

Helen Dickinson OBE, Chief Executive, BRC: 

“February saw a return to growth after a disappointing start to the year. The Prime Minister’s roadmap to reopening prompted a burst in spending on non-food items, such as school uniforms. Furthermore, with another month of lockdown still to go, online sales were high, rewarding the retailers who have invested digitally. Couples staying home for Valentine’s Day found themselves splashing out at their local supermarket, benefitting food sales. Meanwhile, the continued closure of so-called ‘non-essential’ retail has meant that non-food instore sales remained significantly down, underlining the importance of a successful reopening in April.

“While the uptick in sales is encouraging, many retailers are concerned about the months ahead. Many retail businesses will be hoping that customers will return to shops, and have spent hundreds of millions on making their premises Covid-secure, but previous reopenings have shown that demand can be slow to come back. Government has a vital role to play in building up consumer confidence across the country to power the spending-led recovery.”

Paul Martin, UK head of retail, KPMG: 

“After a bleak January sales performance and as the national lockdown continued, February saw the mildest of upturns for the retail sector, with just 1% year on year growth as high street stores across the country kept their doors closed.  

“Consumers continued to nest down for further weeks at home, with food and drink, technology, furniture and home accessories recording strong growth both online and on the high street.  Online channels recorded strong sales across all categories, with some even registering triple figure growth, whilst high street clothing and health and beauty categories continue to suffer, with sales falling by double figures.

“With the Government’s roadmap out of lock down in place and the vaccine rollout moving at pace, there is finally light at the end of the tunnel for non-essential retailers.  High streets will be counting down the weeks until they can finally open their doors and hoping consumers swap their slippers for trainers as they start to hit the shops.  Although the Budget threw retailers a short term lifeline with the extension of Covid support packages until after the summer, conditions will continue to be incredibly challenging as they face subdued demand, thinner margins and rising logistics costs, alongside the accelerated structural changes to the sector. All hopes will be pinned on consumers wanting to break free from home to browse the stores that have been out of bounds for months.”

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

“Food and drink sales remained strong in February with supermarkets continuing to benefit from the ongoing closure of non-essential retail and the out-of-home sector. Furthermore, sales were boosted by Valentine’s Day as shoppers splashed out on treats and gifts. However, from now this growth trend will face much tougher comparisons versus the onset of panic buying in March 2020.  Nevertheless, the value of the grocery market is still unlikely to return to a more usual level until lockdown restrictions start to ease and a more normal consumer landscape is restored.

 

“IGD’s Shopper Confidence Index improved for the second month running in February, reaching its highest level since January 2020. Confidence has been buoyed by the planned easing of lockdown restrictions and the swift rollout of the COVID-19 vaccination programme. This boost will likely continue in the short-term as more people are vaccinated and the further extension of financial support for sectors impacted by the pandemic. However, confidence is likely to remain fragile among lower affluence groups.”

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