Overall retail sales growth slowed drastically in January but furniture sales saw a boost, reports the latest BRC-KPMG Sales Monitor.
January saw UK retail sales decrease by 0.6% on a LFL basis from January 2016, when they had increased 2.6% from the preceding year. On a total basis, sales rose just 0.1% in January, against a 3.3% increase in January 2016 – well below the three-month average of 1.1% and the 12-month average of 0.9%.
Over the three months to January, non-food retail sales in the UK rose 0.2% on a LFL basis and 0.3% on a total basis – below the 12-month total average growth of 0.8%, the lowest since July 2012. Total online sales grew 8.6% while in-store sales declined 2.4% on a LFL basis.
Helen Dickinson OBE, chief executive, British Retail Consortium, says: “After a strong end to the Christmas trading, YoY sales growth ground to a halt, compensated only by stronger furniture sales and a boost for some retailers from Chinese New Year. While this may appear disappointing overall, retailers were up against a strong January last year to try and deliver a repeat performance and many reported an increase in the number of returns received in January.
“Looking across the last three months, we’ve seen the slowest growth of the festive period since 2009. Closer inspection reveals that this was driven by slowing sales in non-food sectors.
“These figures suggest that caution was top of new year shopping lists and the uptick in credit card lending at the end of the last year may be short lived. With the signs pointing to upward pressures on shop prices given rising import costs, all eyes will be on the impact of inflation on consumer spending. That said, retailers are a resilient and innovative bunch. They have become increasingly adept at responding to the challenging environment, and as a result the industry has been a key driver of recent UK productivity growth.”
Paul Martin, UK head of retail, KPMG, adds: “As is historically the case in January, furniture sales experienced strong performance, with the new year perhaps prompting shoppers to consider new-look decor."
