The latest research and analysis from the BRC

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The British Retail Consortium produces unbiased research and analysis on retail performance and the economic drivers influencing the British retail industry. The MIA’s Membership with the BRC gives us access to an expanded portfolio of content to share with our members. We’re pleased to share the headline statistics from these reports on Shop Price Index, Economic Briefing, Retail Sales and Footfall in November 2021.

‘Footfall on High Streets declining’

BRC – SENSORMATIC IQ FOOTFALL MONITOR:

  • Total UK footfall decreased by 15.7% in November (Yo2Y), with a 2.0 percentage point decrease from October. This is below the 3-month average decline of 15.5%.
  • Footfall on High Streets declined by 19.6% in November (Yo2Y), 1.3 percentage points below last month’s rate and above the 3-month average decline of 20.3%.
  • Retail Parks saw footfall decrease by 4.1% (Yo2Y), 3.7 percentage points below last month’s rate and below the 3-month average decline of 2.0%.
  • Shopping Centre footfall declined by 34.8% (Yo2Y), 1.2 percentage points below last month’s rate and below the 3-month average decline of 33.7%
  • Black Friday itself saw a decline of 23.4% (Yo2Y), however, footfall was still 35.3% higher than the previous weekend (19 Nov 2021).

Helen Dickinson OBE, Chief-Executive of British Retail Consortium, said:

“Footfall figures slipped back slightly on last month, as the harsh November weather deterred some customers from shopping instore. While footfall over the Black Friday weekend failed to match its 2019 levels, this year saw deals spread over the entire month, allowing customers to bargain hunt over a prolonged period. Nevertheless, this month’s footfall was still comparatively strong at the second highest figure for this year, only second to October. London also started to catch up with other major cities as the Christmas lights and markets kicked off the festive season, whilst Northern Ireland consumers benefitted from the High Street voucher system.

“With new legal requirements on face coverings now in force in England, we ask shoppers to be considerate of one another and wear a face covering when in store. Retailers are playing their part by encouraging face coverings through store signage and other announcements. However, it is vital these new rules do not put shopworkers in harm’s way and enforcement of face coverings must remain the duty of police and local authorities. Retailers are doing everything they can to satisfy their customers, prioritising the food and other products necessary for everyone to make the most of the festive season.”

‘We expect the rate of inflation to accelerate over coming months’

BRC – NIELSENIQ SHOP PRICE INDEX:

The BRC-Nielsen Shop Price Index is a monthly measure of UK shop price inflation. The SPI measures changes in the price of 500 of the most commonly bought items. The report demonstrates the extent to which retailers contribute to inflation through the pricing of commonly bought goods

Summary:

  • Shop Price annual rose by 0.3% in November compared to October’s decrease of 0.4%. This is above the 12- and 6-month average price decreases of 1.2% and 0.6%, respectively. This is the first time that prices have risen since May 2019.
  • Non-Food deflation slowed to 0.1% in November compared to the decline of 1.0% in October. This is a slower rate of decline than the 12- and 6-month average price declines of 2.0% and 1.0%, respectively. This is the slowest rate of decline since May 2019.
  • Food inflation accelerated to 1.1% in November up from 0.5% in October. This is above the 12- and 6-month average price growth rates of 0.1% and 0.1%, respectively. This is the highest inflation rate since November 2020.
  • Fresh Food inflation accelerated to 1.2% in November up from 0.3% in October. This is above the 12- and 6-month average price growth rates of -0.6% and -0.2%, respectively. This is the highest inflation rate since August 2019.
  • Ambient Food inflation accelerated to 0.9% in November up from 0.8% in October. This is below the 12- month average price increase of 1.1% and above the 6-month average price increase of 0.6%. This is the highest rate of increase since April 2021.

Helen Dickinson OBE, Chief Executive, British Retail Consortium, said:

“November saw overall year-on-year prices increase for the first time in two and a half years, driven by rising food prices, and non-food deflation slowing. The impact of labour shortages, rising commodity prices and transportation costs have now very clearly taken their hold on consumer prices. With food prices rising, and particularly fresh food – which saw the highest inflation since 2019 – we may find some of our Christmas shopping a little more expensive this year. Food was also affected by a rise in global food costs where certain staples, such as vegetable oil, have doubled in price in the past two years.

“With ongoing labour shortages throughout the supply chain expected to continue for some time, and no signs that rising costs of transport and commodities will subside, we expect the rate of inflation to accelerate over coming months. Retailers are doing all they can to mitigate the impacts for their customers, Government also must play its part and work with industry to find long-term solutions to the labour shortages as this will help to relieve cost pressures and protect the pockets of the British public who are already facing mounting costs from increasing energy prices and the looming rise in national insurance.”

‘Omicron adds to uncertain outlook’

BRC ECONOMIC BRIEFING REPORT (EBR):

  • Q3 GDP increased by 1.3%, down from 5.5% in Q2, when many restrictions lifted. This puts current GDP 2.1% below Q4 2019 level.
  • UK prices rose by 4.2% year-on-year in October, above market expectations of 3.9%, and the highest rate of growth in a decade. One of the main drivers of October’s inflation was the rise in households’ energy bills, as the regulator caps on retail electricity and gas price increased.
  • In October, BRC-KPMG retail sales grew by to 1.3% year-on-year, up from September’s 0.6%. Food sales slowed to its lowest rate since the onset of the pandemic, with 1.5% growth year-on-year, and Non-Food sales slowed down to 1.8% growth year-on-year.
  • The labour market improved yet again in Q3, with employment rising to 75.4% and unemployment to 4.3%.
  • Vacancies have reached a record figure of 1.17mill in the three months to October and show little signs of slowing. Retail saw 5,000 more vacancies than two years ago, or 6% more.

‘Black Friday Sales return to boost retail spending’

BRC-KPMG RETAIL SALES MONITOR

  • In November, UK retail sales increased 1.8% on a Like-for-like basis from November 2020, when they had increased 7.7%. This was above the 3-month average growth of 0.2% and below the 12-month average growth of 9.3%.
  • On a Total basis, sales increased by 5.0% in November, against a growth of 0.9% in November 2020. This is above the 3-month average growth of 2.2% and the 12-month average growth of 9.9%.
  • Over the three months to November, In-Store sales of Non-Food items declined 5.1% on a 2-year Total basis and 3.4% on a Like-for-like basis since November 2019. This is worse than the 2019 Total average decline of 3.1%.
  • Over the three months to November, Food sales decreased 0.5% on a Like-for-like basis and increased 0.1% on a Total basis. This is below the 12-month Total average growth of 3.7%. For the month of November, Food was in decline year-on-year.
  • Over the three-months to November, Non-Food retail sales increased by 0.9% on a like-for-like basis and 3.9% on a Total basis. This is below the 12-month Total average growth of 15.1%. For the month of November, Non-Food was in growth year-on-year.
  • Online Non-Food sales increased by 18.0% in November, against a decline of 10.1% in April 2019. This is below the 3-mth average of 23.4%. Non-Food Online penetration rate decreased from 71.0% in November 2020 to 47.5% this November.

Helen Dickinson OBE, Chief Executive, British Retail Consortium, said:

“While Christmas may or may not be getting earlier every year, Black Friday certainly is. The American holiday has now become a month-long affair in the UK, with deals spread over a longer period than ever before. As people prepared their wardrobes for the cold weather this winter, consumers took advantage of discounted clothing, shifting the focus of Black Friday from just electronics and household appliances. While e-commerce was significantly down on last year, when lockdown pushed more consumers online, it still remains almost one-fifth up on pre-pandemic levels, accounting for almost half of all Non-Food spend.

“Looking forward to Christmas, spending patterns suggest that sales could be more spread out than in previous years. Consumers, erring on the side of caution, are shopping for gifts earlier to get ahead of issues relating to shipping and transport. Meanwhile, retailers are doing everything they can to prepare stores, warehouses and deliveries ahead of Christmas, prioritising all the food and gifts that customers will need to enjoy the festive season.”

As a member of the BRC, the MIA can share the full reports with our members. If you would like to see any of these 4 reports in full, please contact alice@mia.org.uk