LONDON, 2014-11-11— /EPR Retail News/ — UK retail sales were flat, at 0.0%, on a like-for-like basis from October 2013, when they had increased 0.8% on the preceding year. On a total basis, sales were up 1.4%, against a 2.6% rise in October 2013. This was an improvement on the previous month and beat the three-month average growth of 1.0%.
Furniture and the home categories were the best performing ones in October.
Over the last three months, Food showed a decline of 1.4% and reported a twelve-month average decline for the second consecutive month, at -0.4%. Non-Food reported growth of 2.8% over the three months to October 2014, underperforming its twelve-month average of 3.7%.
Online sales of non-food products in the UK grew 15.4% in October versus a year earlier, when it had grown 12.1%. This was the highest online growth since Christmas 2013. The Non-Food online penetration rate was 18.2% in October, 1.7 percentage points higher than in October 2013.
Helen Dickinson, Director General, British Retail Consortium, said: “The good news is that overall retail sales continued to grow although not as fast as this time last year. Retailers have thought creatively about marketing solutions to incentivise sales of winter merchandise during the warmer weather. For example the use of analytics has enabled loyal customers to be offered targeted flash reductions with sale items being made available both in store and online.
“Consumers are still prioritising household items such as furniture over fashion, with furniture outperforming all other categories for a second month in a row. Retailers preparation around stocking items required for Halloween celebrations such as costumes of characters from animation feature films for children, meant a significant year on year increase in Halloween related sales. The impact was also felt with an improved three month average in sales of food although not enough to stem the trend felt over the last six months. It remains to be seen whether the Christmas period will start to provide better fortunes for food, however there are positive signs that beauty and homeware items traditionally popular for gifting are selling increasingly well in the build-up to the festive period.”
David McCorquodale, Head of Retail, KPMG, said: “Looking at these figures, most retailers will feel they were tricked rather than treated in October. Even the most experienced of shopkeepers could not have foreseen a heat wave at Halloween and most were left with sales which were flat at best.
“Sadly, this warmer weather has left many fashion retailers with a substantial stock overhang, raising the question of earlier and deeper discounts as we get closer to Christmas. Retailers need a nippy November to help them sell their winter stock before the season’s out.
“Promotions remained rife in the grocery sector, leaving it with the unenviable moniker of the worst performing sector. The silver lining for the sector is that the 3 month average like-for-likes, whilst still negative, were not as bad as in September which will be welcome relief in the midst of negative news.
“With Christmas in their sights, retailers are launching their highly anticipated festive campaigns to connect with and inspire consumers to shop with them this year. All channels will be tested to the full over the coming weeks with a careful eye monitoring the margins.”
British Retail Consortium, 21 Dartmouth Street, Westminster, London, SW1H 9BP. 020 7854 8900. info@brc.org.uk.