UK retail experiences record quarter of growth

The British retail market saw sales increase by 13.1 per cent in June, compared to a decline of 1.3 per cent in 2019.

On a like-for-like basis, UK sales jumped 17 per cent in comparison to two years ago, when they had dropped 1.6 per cent from the preceding year.

Over the three months to June, in-store sales of non-food items declined 0.1 per cent on a total and increased 47 per cent on a like-for-like basis. This is worse than the 2019 total average decline of 3.1 per cent.

However, for June, total in-store sales and like-for-like sales (excluding temporarily closed stores) saw strong growth.

During the 12-week period, food sales increased 7.9 per cent on a total basis and 9.1 per cent on a like-for-like basis. This is higher than the 2019 total average growth of 1.4 per cent.

For the month of June, food was in growth year-on-year.

Across the same period, non-food retail sales rose by 12.4 per cent on a total basis and 45.2 per cent on a like-for-like basis.

This is above the 2019 total average decline of 1.3 per cent.

In June, non-food was also in growth year-on-year.

Online non-food sales increased by 31.3 per cent in June, against a growth of 1.5 per cent in June 2019. This is below the 12-week average of 40.3 per cent.

"The second quarter of 2021 saw exceptional growth as the gradual unlocking of the UK economy encouraged a release of pent-up demand built up over previous lockdowns,” said Helen Dickinson, chief executive of the British Retail Consortium. “In June, while growth in food sales begun to slow, non-food sales were bolstered by growing consumer confidence and the continued unleashing of consumer demand.”

Dickinson added: “With many people taking staycations, or cheaper UK-based holidays, many have found they have a little extra to spend at the shops, with strong growth in-store in June. Fashion and footwear did well while the sun was out in the first half of June, while the start of Euro 2020 provided a boost for TVs, snack food and beer.”

But the chief exec warned that UK retail is still facing challenges, with many retailers making up for ground lost during lockdowns.

She pointed out that city centre retailers are still experiencing low footfall and spending due to commuter and international tourist numbers remaining well below pre-pandemic levels.

“Retail sales growth continued in June, albeit at a slower rate as the re-opening of hospitality and leisure sectors led to a dilution in consumer spending,” said Paul Martin, UK head of retail at KPMG. “The fight for share of wallet is underway, as consumers unleash pent up demand for social activities as restrictions in the UK continue to unwind.”

Martin explained: “Whilst the High Street saw continued growth in June, with sales up 10 per cent, online sales fell back by 7 per cent compared to June 2020. However, penetration rates for online sales remain much higher than their pre-pandemic levels, suggesting the shift to online is here to stay.”

He said that sales of clothing and footwear has started to recover with double digit growth across all channels.

However, Martin added that there were “unsurprising declines” across some categories which had seen a boom in lockdown, like technology, home accessories, and furnishings.

“The food and drink sector has continued to put in a resilient performance this month; comparisons to 2020 remain challenging thanks to the impact of last year’s lockdown, but sales are still significantly elevated against 2019 levels,” said Susan Barrat, chief executive of the Institute of Grocery Distribution (IGD.)“As restrictions continue to ease, IGD ShopperVista insight signals a return to more established shopping behaviour; one in five shoppers made more trips to stores in June to buy food and groceries, compared to just 15 per cent in May ‘21.”

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