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UK Retail Sales Increase By 0.4% In January: BRC–KPMG

By Dayeeta Das
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UK Retail Sales Increase By 0.4% In January: BRC–KPMG

Retail sales in the UK saw a 0.4% increase in January of this year, according to the latest BRC–KPMG Retail Sales Monitor.

This growth is above the three-month and 12-month average declines of 0.4% and 0.2% respectively.

Chief executive of the British Retail Consortium, Helen Dickinson OBE, said, "January saw a return to growth, however recent political uncertainty and a decade of austerity appear to have ingrained a more thrifty approach to shopping among consumers."

Food sales in the UK declined 0.1% on a like-for-like basis, and increased 0.6% on a total basis, in the three months to January 2020.

This is below the 12-month total average growth of 1.2%, and the lowest since February 2017, the study found.

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'Yet To Recover Momentum'

IGD chief executive, Susan Barratt, said, "Growth has yet to recover momentum as the new decade gets underway. Even with January being a typically ‘slow’ month, the start to 2020 has proven to be especially disappointing, with sales growth falling behind previous years."

Non-food retail sales dropped 1.5% on a like-for-like basis and 1.3% on a total basis, during this period.

However, non-food sales registered a marginal year-on-year growth in January 2020, the study revealed.

Partner and UK head of retail at KPMG, Paul Martin, commented, "January is usually a quieter month for retail, and although static sales might not appear triumphant, at least it is no further deterioration."

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Online Sales

In the online segment, sales of non-food items increased by 2.5% in January. This growth is lower than the three-month and 12-month averages of 2.6% and 3.1% respectively.

In January of this year, the non-food online penetration rate increased to 30.6% from 29.5% last year.

Impact Of Brexit

Martin believes that retailers can hope to re-engage with consumers as Brexit is now technically behind them.

"Retailers are walking a tightrope between navigating any impact on their industry alongside ongoing changes in consumer behaviour," he added.

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According to Barratt, UK shoppers were more confident in January of this year, with only 36% expressing concerns about the future of the UK economy post Brexit, compared with 43% in January last year.

Tighter Margins

Dickinson also said that UK retailers were working on tighter margins due to weak consumer demand and increasing costs.

She urged the Government for a commitment to bring down the overall burden of business rates in its upcoming review.

"In the short term, a move in the Budget to address Transitional Relief, which has seen retailers subsidising other industries by almost £500 million since 2017, would prevent further shops closing and save jobs," she said.

© 2020 European Supermarket Magazine – your source for the latest retail news. Article by Dayeeta Das. Click subscribe to sign up to ESM: The European Supermarket Magazine.

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