Volumes of recycled materials could fall if retail sales continue to drop.
According to the British Retail Consortium, Christmas retail sales stalled in December as stores experienced the worst sales performance growth in ten years.
With Christmas the busiest time of the year for retailers, this could signify a trend of falling sales at the beginning of 2019, which is likely to ultimately mean less material will be available for recycling.
While total sales did not change from last year, on a like-to-like basis, retailers saw a 0.7% decrease.
The total three-month average for food increased by 1.8%, with the non-food average for the same period declining by 0.4%.
Across all categories, the total 3-month average was 0.5%.
British Retail Consortium chief executive Helen Dickinson said: “Squeezed consumers chose not to splash out this Christmas with retail sales growth stalling for the first time in 28 months. The worst December sales performance in ten years means a challenging start to 2019 for retailers, with Business Rates set to rise once again this year, and the threat of a No-Deal Brexit looming ever larger.
“The retail landscape is changing dramatically in the UK, while the trading environment remains tough. Retailers are facing up this challenge but are having to wrestle with mounting costs from a succession of government policies – from the Apprenticeship Levy, to higher wage costs, to rising business rates.
“Retail makes up 5 per cent of the economy yet pays 10 per cent of all business taxes and 25 per cent of all business rates. This is neither fair nor sustainable. The Government should urgently look into reforming the broken business rates system and champion the future of retail in the UK.”
KPMG UK head of retail Paul Martin said: “Retailers experienced little festive cheer this year, with total sales in December delivering zero growth on last year. This comes despite some retailers desperately attempting to generate sales through slashed pricing, which has seemingly not been enough to encourage shoppers.
“Growth in food did provide a glimmer of hope, being among the few categories to notice an uptick. However, the continued contrast in performance between the high street and online remained evident in December – albeit 2018 did also see a continued slowdown in online retail sales.
“The first months of 2019 will unlikely hold much improvement. As many retailers report their festive trading performance, the list of winners and losers will become clear, but winning means more than just improving sales. Retailers have to protect their margins in order to deliver a profitable festive season.”