Sales slowed in August as the Olympics and outdoor activities diverted shoppers’ attention, reports BRC-KPMG in its latest Retail Sales Monitor.
On a total basis, sales declined 0.3%, against a 0.1% increase in August 2015. This is the weakest performance since September 2014, excluding Easter distortions. On a three-month basis, total UK retail sales rose 0.6% – half the rate of the 12-month average of 1.2%.
The slowdown – which affected most non-food categories – was driven by lower footfall due to the warmer weather, and is therefore likely to be short-lived.
Furniture total sales remained positive in August, yet slowed further from July. Good sales were reported for bedroom and dining furniture. The timing of payday after the Bank Holiday weekend, as opposed to just before it last year, may have been less conducive to making large ticket items this year than last.
The home accessories category recorded its worst performance since April 2014.
Helen Dickinson OBE, BRC chief executive, says: “A month of extraordinary achievement for Team GB certainly produced a feelgood effect and consumer confidence was up on July, but that generally didn’t translate into extra sales. Consumers were enticed towards leisure and outdoor activities rather than shopping.
“Care should be taken in reading too much into August’s lacklustre performance. As we’ve seen in the last couple of months, data portending the health of the economy paint a volatile picture. The fact is that so far little has directly changed for the UK’s consumers as a result of the referendum, so it’s the pre-existing market dynamics that are still driving sales. The slowdown in real wage growth in the first half of 2016 and strong competition will continue to weigh on trend growth in total sales, whilst holiday timings, promotional and seasonal activity will contribute to fluctuations month on month."
