High Street

Retail sales growth slows in July amid heatwave

Total retail sales growth slowed in July according to the latest BRC-KPMG Retail Sales Monitor, growing only 0.5% on a like-for-like basis.

According to the report sales of non-food products struggled during the month as demand for seasonal purchases slowed due to the heat, which kept shoppers away from days spent “browsing new ranges”.

Over the last year, in-store sales of non-food products fell 2.5%, at the same time as business rates bills increasing by nearly 3%.

However, the sweltering temperatures in July meant shoppers focussed on “eating, drinking and keeping cool”, as food sales had its best month in five years.

Joanne Denney-Finch, CEO of the IGD, said: “July’s food and grocery sales were a reason to celebrate after the best year-on-year uplift since July 2013. Beverages fared best of all thanks to England’s World Cup Semi-Final appearance and exceptionally hot weather throughout.

BRC CEO Helen Dickinson, added: “Although the weather generates a shift in month-to-month spending, trend growth remains very low by historical standards. Physical stores have been particularly affected by pressures on consumers while costs borne by retailers have continued to rise.

“Although changing consumer behaviour means we will have fewer shops in future, the reality is that if we want to support a positive reinvention of our high streets, business rates cannot go on increasing.”

Paul Martin, head of retail at KPMG, added: “July’s performance reinforces the fact that it will take more than events-based retail and sunshine to improve the health of the high-street. Retailers must improve efficiency, in many cases reinvent themselves and adapt to the changing retail environment, including last week’s interest rate rise.”

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