The British Retail Consortium (BRC) has revealed that UK retail sales increased by 0.2% on a like-for-like basis from January 2014, when they had increased 3.9% on the preceding year. On a total basis, sales were up 1.6%, against a 5.4% rise in January 2014 and above the 12-month average of 1.4%.
‘Non-food’ performance was reportedly helped by the continuation of end-of-season sales into January and online sales of non-food products in the UK grew 11.7% in January versus a year earlier, when it had grown 19.2%. The non-food online penetration rate was 18.4%, up from 16.8% in January 2014.
BRC director general Helen Dickinson (pictured) said: “Retail sales have continued to grow, with January reporting a respectable 1.6% increase. Looking into the numbers a little more closely gives us even more cause for optimism – last year retailers had a bumper January so to see growth against such a tough comparison shows the industry to be in rude health. Customers were offered attractive bargains on winter ranges but it remains to be seen at what cost to the retailers’ margins.”
KPMG head of retail David McCorquodale added: “After a subdued December, retailers experienced a semi-revival in fortunes as shoppers took advantage of the bargains on offer in the January sales. The clothing, toys and household appliances sectors particularly benefitted from this spending spree, notching up year-on-year growth against tough comparables from the year before.
“These figures clearly demonstrate the difficult cycle that retailers are trapped in. Demand is now almost solely driven by discounts, with shoppers very reluctant to buy goods at full price in the hope that yet another sale could be just around the corner. This promotion-led environment risks becoming the new normal: retailers are struggling to persuade consumers to break the habit and go back to the traditional sales cycle.”