29 March 2024, 08:46
By Furniture News Jul 13, 2021

UK retail enjoys best quarter on record, says BRC-KPMG

In June 2021, on a total basis, retail sales increased by +13.1% in June (Yo2Y), against a decline of -1.3% in June 2019 (YoY), states BRC-KPMG. 

UK retail sales increased +17% on a LFL basis from June 2019, when they had decreased -1.6% from the preceding year (online sales play a far greater role in LFL, so have increased the growth rate significantly, states BRC-KPMG).

Over the three months to June, in-store sales of non-food items declined -0.1% on a total basis and increased +47% on a LFL basis – worse than the 2019 total average decline of -3.1%. However, for June 2021, the total in-store sales and the LFL sales (excluding temporarily closed stores) saw strong growth. The non-food category was in growth YoY.

Online non-food sales increased by +31.3%, against a growth of +1.5% in June 2019. Non-food online penetration rate decreased from 49.7% in June 2020 to 39.3% this June.

Helen Dickinson, chief executive of the British Retail Consortium (BRC), says: "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. 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. 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.

“Nonetheless, UK retail is still facing strong headwinds, with many retailers still making up for ground lost during the previous lockdowns. City centre retailers continue to suffer low footfall and spending as commuters and international tourist numbers remained well below pre-pandemic levels. Consumer comfort with the next stage of the roadmap will be key to the ongoing success of retail. Many customers are looking forward to a return to a more normal shopping experience, while others may be discouraged by the change in facecovering rules. The Government will need to reassure the public on safety, while pushing forward with its hugely successful vaccination programme. The public will also need to be understanding of one another during the easing of restrictions – there has been a big rise in violence and abuse against retail workers during the pandemic, and colleagues cannot be put in the firing line because of this change in policy."

Paul Martin, UK head of retail, KPMG, adds: “Retail sales growth continued in June, albeit at a slower rate as the reopening of hospitality and leisure sectors led to a dilution in consumer spending. 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.

“Whilst the high street saw continued growth in June, with sales up +10%, online sales fell back by -7% 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. Sales of men and women’s clothing and footwear have started to recover, with double-digit growth across all channels, but there were unsurprising declines across those categories which had seen a boom in lockdown, such as technology and home accessories and furnishings.

“Retailers are facing challenges on a number of fronts – particularly convincing consumers that it’s safe to shop in-store as restrictions around mask wearing and social distancing come to an end. With travel now looking to be back on the agenda for summer and Government Covid-19 support packages slowly coming to an end, retailers will be hoping that the feelgood factor from Euro 2020 and lifting of Covid-19 restrictions will give the high street the summer boost it needs.”

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