New year sales slump with stores closed

New year sales slump with stores closed

Total sales decreased by 1.3% in January, against a decline of 0.4% in January 2020

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covering the four weeks 3 – 30 January 2021

 

  • On a Total basis, sales decreased by 1.3% in January, against a decline of 0.4% in January 2020*. This is below the 3-month average growth of 0.6% and above the 12m average decline of 0.4%.
  • UK retail sales increased 7.1% on a Like-for-like basis from January 2020, when they had decreased 0.8% from the preceding year*.
  • Over the three months to January, In-Store sales of Non-Food items declined 36.5% on a Total and 19.8% on a Like-for-like basis. This is worse than the 12-month Total average decline of 28.3%. For January, the like-for-like excluding temporarily closed stores remained in decline.
  • Over the three months to January, Food sales increased 7.5% on a Like-for-like basis and 7.9% on a Total basis. This is higher than the 12-month Total average growth of 6.1%. For the month of January, Food was in growth year-on-year.
  • Over the three-months to January, Non-Food retail sales increased by 5.6% on a like-for-like basis and declined 5.6% on a Total basis. This is above the 12-month Total average decline of 5.8%. For the month of January, Non-Food was in decline year-on-year.
  • Online Non-Food sales increased by 83.0% in January, against a growth of 1.0% in January 2020*. This is above the 3-mth average of 57.3% and the 12-mth average of 43.1%.
  • Non-Food Online penetration rate increased from 31.2% in January 2020 to 63.6% this January.

* Note 2020 was a 53-week year in the ONS calendar: as a result of the extra week in January 2020, the comparable performances cited here may differ from those published last year, due to the one-week shift in the comparison.

Helen Dickinson OBE, Chief Executive | British Retail Consortium

“January saw retail sales growth decline to its lowest level since May of last year. The current lockdown has hit non-essential retailers harder than in November, with the new variant hampering consumer confidence and leading customers to hold back on spending – especially on clothing and footwear. Meanwhile, retailers have worked incredibly hard to expand their online delivery and click and collect offerings to ensure everyone can get the products they need during lockdown. This has led to record growth for online non-food sales and is a testament to the resilience and innovation of retail, which in the face of the pandemic, has rapidly adapted and invested in online platforms and delivery logistics.

“Retail firms are supporting the Government’s efforts to combat the virus and the industry will continue to play its part in the fight by stepping up safety measures to keep their teams and customers safe. However, three periods of prolonged closure for some and the ongoing uncertainty around reopening puts many retailers in a precarious position. If Government wants to avoid further administrations of otherwise viable businesses and thousands of jobs losses, it must provide those firms which have been hardest hit with the necessary financial support, including targeted business rates relief beyond March.”

Paul Martin, UK Head of Retail | KPMG

“For the first time since last spring, we saw total monthly sales decline and even the on-going demand for groceries and home-related categories was not enough to halt the fall. Although online channels continued to experience historic growth with more than 60% of all non-food sales transacted online, the lockdown meant that the traditional January sales period did not really materialise for the rest of the retail sector, with just a handful of categories recording any growth.

“Computing was the hot category and saw triple figure growth online as schools closed and parents rushed to purchase laptops and printers.  Meanwhile, clothing retailers continued to struggle with physical sales down across all categories. 

“With much of the UK in lockdown for the foreseeable weeks, conditions for retailers will continue to be incredibly challenging. On the one side dealing with a continued increase in online demand versus subdued demand on the high street - and overall in many cases, thinner margins and rising logistics costs and complexities post Brexit. Consumers are well versed in lockdown living now, and looking ahead, fortunes will be mixed but pent up savings and a successful vaccine roll out should help to support recovery in the retail sector later in the year.”

Food & Drink sector performance | Susan Barratt, CEO | IGD

“Food and drink sales followed a familiar January dynamic, dropping back following the festive sales generated in December. The latest national lockdown triggered a small spike in sales at the start of the month, but this was much more modest than the surge experienced in the first lockdown in March. Many categories continue to benefit from the closure of the out-of-home sector. Alcohol sales have fared particularly well, with ‘dry January’ having little impact on consumers’ spending.

“IGD’s Shopper Confidence Index improved in January to the highest level since February 2020, boosted by the swift rollout of the COVID-19 vaccination programme. Confidence has increased most among those aged 55 and over, a priority group to receive the vaccine. While boosted in the short-term, confidence is likely to remain fragile as shoppers feel the impact of the economic downturn. Any supply chain disruption due to the new trade deal with the EU could also have an

 

-ENDS-

 

The BRC sent this release to our "High Streets" and "Monitors" media lists. To check/update what media lists you are on, please contact us below:

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