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 retail sales, inflation and footfall.
Sales slump further as spending squeeze continues
Headline Statistics:
- In May, UK retail sales decreased 1.5% on a Like-for-like basis from May 2021, when they had increased 18.5%. This was below the 3-month average decline of 1.1% and the 12-month average growth of 1.8%.
- On a Total basis, sales decreased by 1.1% in May, against an increase of 28.4% in May 2021. This is below the 3-month average growth of 0.7% and the 12-month average growth of 4.1%.
- Over the three months to May, Food sales decreased 1.3% on a Like-for-like basis and 0.7% on a Total basis. This is below the 12-month Total average growth of 0.6%. For the month of May, Food was in growth year-on-year.
- Over the three-months to May, Non-Food retail sales decreased by 1.0% on a like-for-like basis and increased 2.0% on a Total basis. This is below the 12-month Total average growth of 7.0%. For the month of May, Non-Food was in decline year-on-year.
- Over the three months to May, In-Store sales of Non-Food items increased 31.5% on a Total basis and 24.1% on a Like-for-like basis since May 2021. This is below the 12-month growth of 39.2%.
- Online Non-Food sales decreased by 8.5% in May, against a decline of 8.1% in May 2021. This is above the 3-mth average decline of 18.0%. The Non-Food Online penetration rate decreased from 42.2% in May 2021 to 38.7% this May.
Commentary:
Helen Dickinson OBE, Chief Executive, British Retail Consortium, said:
“Sales volumes continued to see significant falls as the cost-of-living crunch squeezed consumer demand. Higher value items, such as furniture and electronics, took the biggest hit as shoppers reconsidered major purchases during this difficult time. Fashion and beauty did well as people prepared for holidays abroad and the summer’s social calendar; with red, white and blue outfits adorning shopping carts ahead of the Jubilee weekend. Meanwhile, online sales appear to have stabilised as a ‘new normal’, around nine percentage points above their pre-pandemic levels, but well down on the lockdown peaks.
“It is clear the post-pandemic spending bubble has burst, with retailers facing tougher trading conditions, falling consumer confidence, and soaring inflation. Supply chain issues including rising commodity and transport costs, a tight labour market and higher energy bills are forcing retailers to increase their prices, contributing to wider inflation. Profits may be squeezed further, as retailers make significant investments in their own operations and supply chains to mitigate against future price rises for consumers.”
Fresh food inflation intensifies
Headline Statistics:
- Shop Price annual inflation accelerated to 2.8% in May, up from 2.7% in April. This is above the 12- and 6-month average price increases of 0.7% and 1.9%, respectively. This marks the highest rate of inflation since July 2011.
- Food inflation accelerated to 4.3% in May, up from 3.5% in April. This is above the 12- and 6-month average price growth rates of 1.7% and 3.2%, respectively. This is the highest inflation rate since April 2012.
- Non-Food inflation decelerated to 2% in May, settling down from 2.2% in April. This is above the 12- and 6-month average price increases of 0.2% and 1.3%, respectively. Inflation remains close to the series’ high.
- Fresh Food inflation accelerated in May to 4.5%, up from 3.4% in April. This is above the 12- and 6-month average price growth rates of 1.6% and 3.4%, respectively. This is the highest inflation rate since November 2012.
- Ambient Food inflation accelerated to 4% in May, up from 3.5% in April. This is above the 12- and 6-month average price increases of 1.7% and 2.8%, respectively. This is the highest rate of increase since January 2013.
Commentary:
Helen Dickinson OBE, Chief Executive, British Retail Consortium, said:
Retail prices edged up further as commodity, energy and transport costs continued to climb. Fresh food inflation hit its highest rate in a decade, with items like poultry and margarine seeing some of the largest increases due to soaring costs of animal feed and near-record global food prices. Retailers have been working hard to protect their customers from these rising costs, particularly at a time when households are being impacted by a huge rise in household energy bills.
It is likely to get worse before it will get better for consumers with prices continuing to rise and a further jump in energy costs coming in October. With little sign that the cost burden on retailers will ease any time soon, they will be left with little room for manoeuvre, especially those whose supply chains are affected by lockdowns in China and the war in Ukraine. While many people will welcome the Government’s latest announcement of support, uncertainty in the future of energy prices means they may only provide temporary respite.
Small advances to UK Footfall
Key findings include:
- Total UK footfall decreased by 12.5% in May (Yo3Y), a 0.6 percentage point improvement from April. This is better than the 3-month average decline of 13.7%.
- Footfall on High Streets declined by 13.6% in May (Yo3Y), 3.6 percentage points better than last month’s rate and an improvement on the 3-month average decline of 16.2%.
- Retail Parks saw footfall decrease by 6.3% (Yo3Y), 2.3 percentage points worse than last month’s rate and worse than the 3-month average decline of 5.4%.
- Shopping Centre footfall declined by 26.7% (Yo3Y), 0.9 percentage points better than last month’s rate and above the 3-month average decline of 30.5%.
Helen Dickinson OBE | Chief Executive | British Retail Consortium
UK footfall made small advances for a third month in a row, as the particularly warm May weather saw more people shop in person. The anticipation for the Jubilee celebrations offered an added boost to footfall, with the public hitting the shops to find the best decorations and festive food and drink for the long weekend. London enjoyed the biggest improvement out of all the major UK cities, seeing an increase in tourism as international covid restrictions are rolled back and we enter the summer season.Improvement to footfall remains fragile as the cost-of-living bites. With UK discretionary incomes falling, government’s financial support to tackle surging energy costs may only provide temporary respite for households. As inflation continues to climb and consumer confidence falls, it is by no means certain footfall will continue to improve in the months to come.
