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How did high street and online retail sales fare in August?

Laura  Barnes
How did high street and online retail sales fare in August?

Throughout August, UK retail sales increased by 1.3% on a like-for-like basis compared to the same period a year before, according to the latest Retail Sales Monitor from BRC and KPMG.

On a total basis, sales rose 2.4% in August, against a decline of 0.3% in August 2016, which had been the poorest performance of the year. This is the strongest growth since Easter, above the 3-month and 12-month averages of 1.9% and 1.6% respectively.

Over the three-months to August, non-food retail sales in the UK increased 0.6% on a like-for-like basis and 0.9% on a total basis, above the 12-month total average growth of 0.6%.

Online sales of non-food products grew 11.0% in August, above both the 3-month and 12-month averages of 9.8% and 8.8% respectively. Online penetration rate increased from 21.0% in August 2016 to 21.6% in August 2017.
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“These figures tell a less positive story about the health of consumer spending than it might seem at first glance. Non-food sales have only just recovered to levels seen two years ago, after a dismal August in 2016; while strong figures for food are largely the result of rising prices, leaving growth in volume terms weaker than last year,” said Helen Dickinson OBE, chief executive at BRC.

“Stark challenges lurk around the corner for the retail industry. Purchasing decisions are very much dictated by a shrinking pool of discretionary consumer spend, with the amount of money in people’s pockets set to be dented by inflation and statutory rises in employee pension contributions in a few months’ time. It’s therefore crucial to protect consumers wherever possible from further cost pressures. For Government, this includes ensuring continued choice and availability of affordable, quality products for shoppers post-Brexit, by securing a strong deal on customs and tariff-free trade with the EU.”

Don Williams, retail partner at KPMG, added: “Despite the ongoing challenges for the industry, retailers achieved reasonable growth in August, which is positive news for the industry. Even non-food categories experienced an uptick – a welcome relief given the poor performance recently.

“Mirroring the successes of the high street, online sales continued to go from strength to strength, with all categories noting growth.

“Retailers have managed to achieve stronger than expected growth, however adding to this could be the fact that consumers appear to be turning a blind eye to the potential crush on spending power to come. The industry now needs to overcome further devaluation of the pound and the increased costs therein.”

Tags: Retail , kpmg , brc , august , uk retail sales

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