BRC-NIELSEN SHOP PRICE INDEX: Shop prices fell by -1.3 per cent in June 2015; 26th consecutive month of prices drops

– Overall shop prices reported deflation of 1.3% in June up from 1.9% in May.

– Food reported annual deflation of 0.4% the lowest deflation rate since February 2015.

– On a 12-month average basis, the Shop Price Index reported deflation of 1.7%.

– Non-food deflation slowed to 1.9% in June from 2.5% in May.

LONDON, 2015-7-8 — /EPR Retail News/ — BRC Director General, Helen Dickinson, said: “Shop prices fell by -1.3 per cent this month marking the 26th consecutive month of prices drops. This is a slight slowdown in falling prices when compared with recent months.

“Consumer confidence hit a 15 year high which suggests that shoppers will feel more comfortable about buying major purchases. It also suggests that consumer spending, one of the main drivers of the recovery, should remain robust over the summer.

“While non-food prices fell at a slower rate this month (-1.9 per cent against -2.5 per cent in May), June marked the 27th month of non-food deflation. Shoppers wishing to invest in their home won’t be disappointed with great deals to be found in furniture and flooring and gardening and hardware in particular.

“Food has been deflationary throughout 2015 but the pace slowed in June, largely as the result of the rebound of oil prices in recent months.

“We’re seeing a strong appetite for consumer credit, inflation remains at an historic low, unemployment continues to fall and wages have started to rise, the wider macro-economic data continues to be supportive for the consumer.”

Mike Watkins, Head of Retailer and Business Insight, Nielsen, said: “Retailers continue to use price cuts and promotions to stimulate sales which is helping to maintain shop price deflation, and we see little evidence to suggest that prices will rise in the near future. With many food retailers still using price cuts to attract new shoppers, this is lowering the cost of the weekly shop and so the overall CPI figure in the UK. Deflation and price led competition will continue to be a key driver of sales growth for some time yet”

British Retail Consortium, 21 Dartmouth Street, Westminster, London, SW1H 9BP.
020 7854 8900. info@brc.org.uk.

 

BRC-NIELSEN SHOP PRICE INDEX MARCH 2015: Overall shop prices reported deflation for the 23rd consecutive month, accelerating to 2.1% in March, from 1.7% in February

LONDON, 2015-4-9 — /EPR Retail News/ — Overall shop prices reported deflation for the 23rd consecutive month, accelerating to 2.1% in March, from 1.7% in February.

Food reported annual deflation of 0.9% in March from a 0.4% fall in February.

On a 12-month average basis, the Shop Price Index reported deflation of 1.7%.

Non-food deflation accelerated to 2.8% in March from 2.5% in February.

BRC Director General, Helen Dickinson, said: “Prices in Britain’s shops reached another new low, this month by -2.1 per cent. That’s the deepest deflation rate since our records began in December 2006.

“Food prices saw a further drop, largely as a result of promotions for fresh food, whilst non-food prices fell at a faster rate than last month, hitting a twenty-fourth consecutive month of deflation.

“Clothing and electricals continue to outshine by offering consumers eye-catching bargains. In fact, there’s evidence of plenty of promotions and price-cuts in non-food items which should help drive up sales at a time when retailers are turning their attention to the Summer ranges.

“Both retailers and consumers will cheer on a hat-trick of good economic news. The Consumer price index (CPI) has fallen to zero for the first time on record, boosting incomes in real terms and bringing the UK to the brink of a spell of deflation that is expected in the coming months. That fall is largely the result of a deep oil price slump (down 49 per cent on a year ago) and the continuing fierce competition among supermarkets who’ve dropped fuel and food prices over the year.

“Consumer confidence has also soared to a near 13-year high. Retailers will have been hoping that this translated into shoppers being prepared to splash their cash over the long Easter weekend.

“With strong consumer confidence and relatively benign macro-economic conditions we can expect the nation to respond with their feet or with a mouse click in the coming weeks.”

Mike Watkins, Head of Retailer and Business Insight, Nielsen, said: “Prices continue to fall across the retail industry and deflation is likely to be with us for the near future, which means shoppers are going to be able to stretch their budgets further when shopping in store or online.

“The implication for food retailers is that this may help sustain the slowly improving sales volumes we have seen in recent weeks, and also encourage consumers to spend some of their savings on affordable indulgences. For many high street fashion, home and outdoor retailers, lower prices are being backed up by attractive promotions which comes at good time as momentum builds in selling late Spring and early Summer ranges.”

British Retail Consortium, 21 Dartmouth Street, Westminster, London, SW1H 9BP.
020 7854 8900. info@brc.org.uk.

BRC-NIELSEN SHOP PRICE INDEX JANUARY 2015: Overall shop prices reported deflation for the 21st consecutive month

LONDON, 2015-2-4 — /EPR Retail News/ — Overall shop prices reported deflation for the 21st consecutive month, decelerating to 1.3% in January, after reporting deflation of 1.7% in December.

Food reported annual deflation of 0.5% in January after reporting inflation of 0.1% in December.

On a 12 month average basis, the Shop Price Index reported deflation of 1.6%.

Non-food deflation slowed to 1.8% in January from 2.8% in December.

BRC Director General, Helen Dickinson, said: “For twenty-one consecutive months prices in Britain’s shops have fallen, this month by -1.3 per cent. It’s the second time in three months that we’ve seen food prices fall, accelerating to their lowest levels on record”.

“Clearly customers were taking advantage of the January sales with good bargains for furniture, flooring and electricals resulting in plenty of stock shifting.

“There is some evidence that the heavy discounting in early December resulted in some retailers pulling their new season stock forward, which meant a significant amount of goods were sold at full price in January.

“The halving of the oil price since the summer has helped the retail supply chains with the impact of these falls, continuing to make their way through to shop prices.

“With the outlook for inflation low, the jobs market robust and rising real incomes gathering pace, the outlook for consumer spending looks positive. Deflation doesn’t always translate into bad news for retailers. The Producers Price Index (which tracks the cost of raw materials to producers) remains deflationary, so retail businesses will continue to see decreases in their own input costs for the foreseeable future. To remain competitive, retailers will continue passing these savings on to the consumer.

“2015 is shaping up to be win-win year for shoppers and retailers alike.”

Mike Watkins, Head of Retailer and Business Insight, Nielsen, said: “Over the last six months we have seen food inflation falling and as we start 2015, we now have food deflation. Whilst falling prices are of course welcomed by shoppers, the impact is that there is only marginal value sales growth across the industry. With further price cutting expected by the major Supermarkets the near term outlook is for the continuation of a low growth trading environment. Deflation also continues in clothing and electrical with non-food retailers still able to pass on the benefit of falling supply chain costs to the consumer.”

British Retail Consortium, 21 Dartmouth Street, Westminster, London, SW1H 9BP.
020 7854 8900. info@brc.org.uk.