Retail sales suffer worst decline in 25 years

Retail sales in the UK have fallen by 19.1% on a total basis in April, in the biggest drop recorded by the BRC-KPMG sales monitor since it began in 1995. The decline in total sales, which covers the four weeks to 2 May, compares with a 2.5% uplift seen in April last year. This was also below a 7.5% three-month average decline and 2.3% 12-month average reduction, both of which were also record declines. On a like-for-like basis and excluding temporary store closures, retail sales grew by 5.7% in April, compared with 2% growth seen during the same period in the previous year. This was largely driven by online sales. Non-food sales plummet In-store sales of non-food items plunged 36% on a total basis during the three months to April, dropping by 17.3% on a like-for-like basis as demand for clothing, footwear and large household items fell. The 12-month total average decline for this was 11.5%. Like-for-like sales during April, excluding temporarily closed “non-essential” stores, was also in “double-digit decline”. April’s food sales decline Food sales grew 6% on a like-for-like basis and 4.5% on a total basis in the three months to April, higher than 1.6% total average growth over the past 12 months. However, the monitor noted that food sales for the month of April alone has fallen year-on-year. Helen Dickinson, chief executive of the British Retail Consortium, said the virus had prevented large family gatherings during Easter, impacting food sales.  In the three months to April, non-food retail sales decreased by 4.4% on a like-for-like and 17.5% on a total basis, below a 12-month total average decline of 5.6%.  Online sales buoy retail In contrast, online non-food sales increased by 57.9% in April, against 4% growth in April 2019. This is above 8.5% average growth over the past year.  The online penetration rate for non-food retail surged to 69.9% this April, from 29.9% during the same month last year. Products such as games consoles, bicycles, office equipment, and haberdashery were highlighted as standout performers. Computing equipment, household gadgets, toys and baby equipment also performed well. However, Dickinson said that even the dramatic rise in online sales “could not make up for the loss of in-store purchases”.  “Coronavirus has accelerated many of the trends seen prior to the outbreak and it is likely that as the lockdown wears on, these new shopping habits – such as the trend towards online purchases – will become more entrenched for many consumers,” said Dickinson. Paul Martin, UK head of retail at KPMG, said: “The disparities in retail continue, not only between ‘essential’ and ‘non-essential’, but also between those with an online channel and those without.  “Eyes are firmly fixed on how the easing of restrictions will impact consumer spending going forwards, with the acceleration of online sales likely here to stay and overall demand in certain categories, like fashion, remaining subdued for some time.” To send feedback, e-mail pui-guan.man@egi.co.uk or tweet @PuiGuanM or @estatesgazette