Retail sales slide in May
UK retail sales fell by 0.4% year-on-year on a like-for-like basis in May according to new figures. On a total basis, sales rose by 0.2%.
The figures from the BRC-KPMG Retail Sales Monitor also reveal that food sales rose by 3.2% on a like-for-like basis and by 4.3% on a total basis in the three months to May. This was the strongest three-month average since February 2012, excluding Easter distortions.
The increase was mainly attributable to inflation combined with warm weather in the run-up to the late May bank holiday which helped beers, wines and spirits achieve double-digit growth.
In the same period, non-food retail sales edged down 0.3% on a like-for-like basis and rose by 0.1% on a total basis.
Helen Dickinson, chief executive of the British Retail Consortium, said: “After the pick-up in sales over Easter, consumer spending slowed again in May resulting in almost flat growth on the previous year. Underneath the headlines, there’s continued variation in the performance of food versus non-food products, as sales performance of the two become increasingly polarised.
“Food sales, albeit positively distorted by inflation, continue to see annual growth, while in non-food categories which are predominantly capturing discretionary spending, retailers find themselves having to compete even harder.”
Meanwhile, online sales of non-food products grew by 4.3% in May compared to a 13.7% rise a year earlier. This was the lowest growth since December 2012.
In the three months to May, online sales of non-food products climbed by 7% while in-store sales declined by 1.8% on a total basis and by 2.3% on a like-for-like basis.
Paul Martin, UK head of retail at KPMG, added: “With such meagre growth in online sales in May, it is vital online retailers master the art of customer-centricity and personalisation. Ensuring the right products are available at the right time, and that surplus stock is not sold at significantly reduced prices, is becoming ever more important. Success will come from an ability to target the online shoppers who spend more and return less.”
