UK retail sales lift 3.2 per cent but provides ‘little cause for optimism’, says BRC

UK retail sales have risen 3.2 per cent for July, the British Retail Consortium has confirmed, but suggests that the lift should provide ‘little cause for optimism’ as many high street shops continue to struggle.

On a total basis, sales increased by 3.2 per cent in July, against an increase of 0.5 per cent in July 2019. It is above the three-month average growth of 0.4 per cent and the 12-month average decline of 1.9 per cent and also marks the second consecutive month of growth since the start of the coronavirus pandemic.

In July, UK retail sales increased 4.3 per cent on a like-for-like basis from July 2019, when they had increased 0.3% from the preceding year. The increase has been measured by excluding temporarily closed stores, but including online sales.

Online non-food sales increased by 41.0 per cent in July, against a growth of 3.7 per cent in July 2019. This has come in below the three-month average of 49.7 per cent but above the 12 month average of 19.9 per cent.

But while the results show a lift for the high street over the last two months, Helen Dickinson OBE, chief executive, British Retail Consortium, states that ‘many shops continued to struggle as footfall was down, with many people still reluctant to go out and making fewer impulse purchases.’

“The strongest performance came from food, furniture and homeware, as consumers increasingly invest in their time at home, however, many shops, particularly in fashion, jewellery and beauty, are still struggling to survive,” she said. “Online sales remained buoyant, slowing only slightly despite more shops reopening.

“While the rise in retail sales is a step in the right direction, the industry is still trying to catch up lost ground, with most shops having suffered months of closures. The fragile economic situation continues to bear down on consumer confidence, with some retailers hanging by only a thread in the face of rising costs and lower sales.

“Rents are also continuing to accumulate and the next Quarter Rent Day could see many otherwise viable businesses fall into insolvency, costing stores, jobs and economic growth. The Government should adopt the proposal from landlords and tenants for a Property Bounceback Grant, which would deliver £7 billion in tax revenue to the Exchequer and save 375,000 jobs.”

Last week, figures from the BRC revealed that UK footfall decreased by 42.1 per cent in July, an improvement from June’s fall of 62.6 per cent, according to BRC-ShopperTrak data.

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