KPMG retail sales monitor January 2019
Covering the four weeks 30th December 2018 - 26th January 2019
• In January, UK retail sales increased by 1.8% on a like-for-like basis from January 2018, when they had increased 0.6% from the preceding year.
• On a total basis, sales increased by 2.2% in January, against an increase of 1.4% in January 2018. This was the highest growth since June and above both the 3-month and 12-month averages of 0.8% and 1.2% respectively.
• Over the three months to January, In-store sales of Non-Food items declined 2.6% on a Total basis and 3.2% on a like-for-like basis. This is below the 12-month total average decline of 2.3%.
• Over the three months to January, food sales increased 1.3% on a like-for-like basis and 2.4% on a total basis, the highest since September. This is below the 12-month total average growth of 3.0%, which is the lowest since September 2017.
• Over the three-months to January, non-food retail sales in the UK decreased 0.8% on a like-for-like basis and 0.4% on a Total basis. This is below the 12-month total average decrease of 0.2%. Non-food sales returned to growth in January, after two months of decline.
• Online sales of non-food products grew 5.4% in January, against a growth of 5.3% in January 2018. This is above the 3-month average of 4.8% but below the 12-month average of 7.0%. This is the lowest 3-month average since we started measuring online in December 2012. Online penetration rate increased from 28.2% in January 2018 to 29.4% last month.
Paul Martin, UK Head of Retail | KPMG
“Following the worst December trading performance in a decade, January brought a welcome improvement with total retail sales up 2.2 per cent. Having said that, this increase points more to British shoppers’ obsession of bagging a bargain and price inflation, rather than any real improvement, and these peaks and troughs continue to leave retailers feeling increasingly anxious.
“The colder weather and continual discounting drove up fashion sales, whilst the increased focus indoors also boosted furniture sales. However, not all categories or players have been so fortunate, and even online growth continued to slow.
“Eyes are naturally fixed on who the next casualty will be, but we can’t afford to overlook those excelling despite adverse conditions. Winning retailers remain attractive to investors and consumers; they are adaptive and agile, and ultimately they continue to outperform in this rapidly evolving market.”
Helen Dickinson OBE, Chief Executive | British Retail Consortium
“There was a welcome return to growth this month after December’s disappointing sales figures. But while retail discounts helped tempt cautious consumers, there is no guarantee this momentum will continue after the sales have finished. And it will not just be brick-and-mortar stores looking nervously to the future, as online sales continued to grow below the long term trend.
“Furthermore, the risk of a disruptive no deal Brexit could see these fortunes reversed. Unless the Government want to see well known brands disappearing from our high streets in 2019, they should work with their colleagues in Parliament to find a solution that avoids the shock of a no-deal Brexit on 29 March and removes the risks to UK consumers.”
Food & Drink sector performance | Susan Barratt, CEO | IGD
“Bolstered by the inclusion of New Year’s Eve in the latest figures and relatively mild weather before the recent snowfall, food and grocery sales held up reasonably well in January.
“Looking to shopper sentiment, we’re seeing polarisation in views on quality vs. cost. Whereas 14% say they will put a greater focus on quality in their food shopping this year, up from 12% in December, another 20% expect to focus more on price. This compares with 17% from the previous month.”
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About the British Retail Consortium
The BRC’s purpose is to make a positive difference to the retail industry and the customers it serves, today and in the future.
Retail is an exciting, dynamic and diverse industry which is going through a period of profound change. The BRC is committed to ensuring the industry thrives through this period of transformation. We tell the story of retail, work with our members to drive positive change and use our expertise and influence to create an economic and policy environment that enables retail businesses to thrive and consumers to benefit. Our membership comprises over 5,000 businesses delivering £180bn of retail sales and employing over one and half million employees.
About KPMG in the UK
KPMG LLP, a UK limited liability partnership, operates from 22 offices across the UK with approximately 16,300 partners and staff. The UK firm recorded a revenue of £2.338 billion in the year ended 30 September 2018. KPMG is a global network of professional firms providing Audit, Tax, and Advisory services. It operates in 154 countries and has 200,000 professionals working in member firms around the world. The independent member firms of the KPMG network are affiliated with KPMG International Cooperative ("KPMG International"), a Swiss entity. Each KPMG firm is a legally distinct and separate entity and describes itself as such.