Retail sales saw the biggest decrease in sales on record said the British Retail Consortium (BRC), as May 2019 delivered political and economy uncertainty, with the risk of further job losses and store closures increasing.
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On a total basis, sales fell by 2.7% in May, and excluding Easter distortions, this is the worst decline since this record began in January 1995.
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However, this was against an increase of 4.1% in May 2018. This fall brings the 3-month and 12-average increases down to 0.2% and 0.9% respectively.
UK retail sales decreased by 3.0% on a like-for-like basis from May 2018, when they had increased by 2.8% in the previous year. This was the steepest like-for-like decline since December 2008, excluding Easter distortions.
Over the three months to May, in-store sales of non-food items decreased by 2.7% on both a total and like-for-like basis. This is worse than the 12-month total average decline of 2.4%.
During the same period, food sales increased by 0.8% on a like-for-like basis and by 1.9% on a total basis. This is below the 12-month total average growth of 2.5%.
In this same time, non-food retail sales in the UK decreased by 1.1% on both a like-for-like basis and a total basis. This is below the 12-month total average decrease of 0.4%.
Online sales of non-food products rose by 1.5% in May, an all-time low, against a growth of 11.5% in May 2018. The 3-month and 12-month average growths were 2.9% and 5.4% respectively.
The non-food online penetration rate increase from 28.2% in May 2018, to 30.3% last month.
BRC chief executive Helen Dickinson said: “With the biggest decline in retail sales on record, the risk of further job losses and store closures will only increase. While May 2018 offered almost unbroken sunshine, topped off by the run up to the World Cup and the marriage of Meghan and Harry, May 2019 delivered political and economic uncertainty. Food sales dropped for the first time since June 2016, with further declines in clothing, footwear and outdoor goods.
“With retail conditions the toughest they have been for a decade, politicians must act to support the successful reinvention of our high streets and local communities. Business rates remain a barrier, preventing many retailers from investing in their physical space. We have a broken tax system, which sees retailers paying vast sums of money regardless of whether they make a penny at the till, and yet the Government is failing to act. The legislation is falling behind the technological revolution.”
KPMG UK head of retail Paul Martin said: “April may have provided retailers with some light reprieve thanks to Easter, but May’s staggering fall of 3% like-for-like is a stark reminder of the industry’s ongoing issues, which for many require urgent attention. We are of course comparing this month’s growth against a stellar May in 2018, but even the 3-month average – which softens the monthly volatility – demonstrates that achieving growth in retail remains a real struggle.
“The bank holiday weekends have given rise to the added interest in furniture and homewares, as shoppers set about making home improvements. However, the weather did little to convince fashion-minded shoppers to refresh their seasonal wardrobes. The extremely low growth online is real cause for concern, especially with almost a third of all non-food sales today being made online. This trend has continued to manifest itself over the last year and requires real focus from the retail community.”