Retail sales continue to grow in February – BRC

by | Mar 8, 2022

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UK retail sales continued to grow in February, industry research showed on Tuesday, as the easing of Covid-19 restrictions saw shoppers return to stores.
However, growth was tempered by storms Dudley and Eunice as well as softening consumer confidence.

According to the latest BRC-KPMG Retail Sales Monitor, total sales rose 6.7% in the four weeks to 26 February, compared to an increase of 1% in the same period in 2021, when the UK was in lockdown. The figure was marginally ahead of the three-month average of 6.5% but well below the 12-month average of 11.3%. In January 2022, total sales rose by 11.9%.

On an underlying basis, sales rose 2.7%, which was below both the three-month average of 3.5% growth and the 12-month average of 8.5%. It was also down on January’s 8.1%.

The British Retail Consortium said growth had been curtailed by the severe weather and weakening consumer confidence, as tensions escalated in Ukraine and the cost of living crisis mounted.

Helen Dickinson, chief executive of the BRC, said: “February saw continued sales growth, although dampened by Storm Eunice and falling consumer confidence. Traditional try-before-you buy products, like furniture and home accessories, as well as fashion and jewellery, continued to be the high-flyers, as more people returned to stores.”

But she warned: “The future is looking increasingly uncertain, with current demand unlikely to be sustained. Consumer confidence, falling in recent months, will likely tumble further against the backdrop of the current geopolitical events. The cost of living will continue to spiral due to global inflation, increasing energy bills and the rise in national insurance.”

Paul Martin, UK head of retail at KPMG, said: “Clothing and footwear witnessed the highest growth, as restrictions were lifted and consumers re-stocked wardrobes, heading back to offices and embracing life living with Covid.

“Online sales volumes continue to fall across all categories compared to February 2021. Penetration, however, remains considerably higher than pre-pandemic levels.

“As we move into a new phase of managing Covid-19, retailers will be focused on keeping consumers spending as the cost of living squeeze threatens the health of the sector.”

Online non-food sales decreased by 28.4% last month, compared to growth of 82.2% a year previously.

Over the three months to February, total food sales increased by just 0.1% and fell by 0.3% on a like-for-like basis. Non-food retail sales increased 12% over the same period, or by 6.9% on an underlying basis.

Susan Barratt, chief executive of IGD, said food and drink sales had proved “resilient” during the month. “Although the market isn’t performing at the same rate as the lockdown boosted growth of 2021, it remains elevated compared to 2020,” she said.

“Part of this will be down to inflation, which is undoubtedly playing a role. Against this backdrop, it’s no surprise that IGD’s Shopper Confidence Index continued its decline in February, reaching another all-time low since the index started in 2013.”

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