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UK retail sales rose slightly in August

Sep 6, 2024 United Kingdom

UK retail sales increased just by 1% year-on-year in August, driven by summer shopping, reflecting the challenging retail environment that is likely to prevail for the rest of the year

According to the BRC-KPMG Retail Sales Monitor, in the four weeks between the 28^th of July and the 24^thof August, total retail sales in the UK increased by 1%, as compared with the same period last year and with growth of 4.1% in August 2023. This figure outpaced the three-month average growth of 0.4% but fell short of the 12-month average of 1.2%.

Non-food sales, including fashion, decreased by 1.7% year-on-year in the three months to August, as compared with a fall of 0.2% in August 2023. This is a slight improvement on the 12-month average decline of 2.0% but still highlights the ongoing challenges in discretionary spending, pointed out the British Retail Consortium (BRC).

“Despite summer finally making an appearance, and a slight uptick in consumer confidence, shoppers did not catch-up their spending during August, with total sales growth of only 1% reflecting the challenging retail environment that is likely to dominate for the rest of this year”, commented Linda Ellett, UK Head of Consumer of Retail & Leisure at KPMG.

She continued: “After many tough months of falling sales, sports and travel equipment enjoyed a welcome boost during this key summer holiday period, and sales of clothing also saw a second month of growth on the high street (…). Fashion retailers will be hoping sales growth continues as they look to dispose of excess summer stock as we head into the key autumn season”.

However, the BRC-KPMG Retail Sales Monitor shows a silver lining in the performance of online channels. Online non-food sales increased by 1.5% year-on-year in August, as compared to an average decline of 1.7% in August 2023, and above the 3-month average increase of 0.3% and the 12-month average decline of 1.8%.

In contrast, in the three months to August, in-store non-food retail sales fell by 2.8% year-on-year, as compared with growth of 1.3% in August 2023 and below the 12-month average fall of 2.1%.

BRC CEO Helen Dickinson was cautious about future prospects. “Following a difficult summer for much of retail, and the possible weakening of consumer spending as energy bills rise come October, many will be waiting for the Chancellor’s Autumn Budget before finalising their investment strategies”.

Reflecting on the fragile nature of consumer confidence, Linda Ellett said that shoppers will continue to prioritise value and urged retailers to differentiate clearly, target specific consumer needs and execute with consistency and clarity.

Image Credits: Adrian Raudaschl on Unsplash

United Kingdom Confidence Retail Sales