Retail sales ‘below expectation’ in April

Retail sales fell below expectations in April, despite a total sales increase of 4.1% against the decrease of 3.1% the previous year, according to the latest BRC-KPMG Retail Sales Monitor. This was due to figures being “distorted” by the timing of the run-up to Easter, which was in April this year compared with March in the previous year. The BRC said one way of correcting for this distortion is to look at the 2-year average. With this in mind, the figure was above both the three-month and 12-month average increases of 1.2% and 1.4% respectively. However, the two-year average growth, which corrects for the Easter distortion, was actually 0.4% per annum, a slowdown from March’s equivalent of 0.9%. In April, UK retail sales increased by 3.7% on a like-for-like basis from April 2018, when it had decreased 4.2% from the preceding year. The two-year average like-for-like change was -0.3% per annum, a slowdown from March’s 0.1% and February’s 0.3%. Over the three months to April, in-store sales of non-food items declined 1.7% on a total basis and 1.8% on a like-for-like basis. This is in line with the 12-month total average decline of 1.8%. Online, the three-month and 12-month average growths were 4.1% and 6.2% respectively. Over the three months to April, food sales increased 1.7% on a like-for-like basis and 2.8% on a total basis. This is below the 12-month Total average growth of 3%. Online sales of non-food products grew 4.3% in April, against a growth of 6.7% in April 2018. The two-year average growth was 5.5% per annum, in line with March’s 5.4% but below the 12-month average of 6.2%. Online penetration rate increased from 28% in April 2018 to 29.7% last month. Helen Dickinson, CEO of the BRC, said: “Retail sales were below expectations this month as the sunshine over the Easter weekend persuaded many to pursue recreational, rather than retail, activities. Department stores, as well as clothing and footwear shops, were harder hit by the warmer weather, while food-to-go fared much better from it. “Online accounted for a little under 30% of all non-food sales, and we expect this proportion to continue to rise. Nonetheless, the pace of growth has slowed over the course of the year despite the investment that many stores have made in their digital offering.” She added: “Retailers are continuing to invest in technology across both physical and online activities as they seek to meet changing consumer behaviour, however some of such spending is being held back by the plethora of Government-imposed business costs bearing down on the industry. “Government should review these costs – and in particular reduce the burden of business rates – if they wish to see retail maintain its place as the main provider of highly valued, flexible jobs in communities up and down the country.”

Retail sales ‘below expectation’ in April

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