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Weather washout

High Street suffers with June rain and fall in consumer confidence

THE UK’s High Streets suffered a washout in June as miserable weather for much of the month and another fall in consumer confidence led to a perfect storm for retailers.

According to the latest BDO High Street Sales Tracker sales fell by 0.8 per cent compared to the same month last year, which already had a weak benchmark of a 1.7 per cent drop.
BDO said early summer sale discounting failed to salvage a month marked by slowed wages and falling confidence, and the figures also mark 16 out of 17 consecutive months of no in-store sales growth in their sales tracker.
“June was another washout month for the High Street,” BDO head of retail Sophie Michael said, “we saw retailers discount early on in June, adding further pressure to tight margins, yet they still weren’t able to salvage the month.
“Retailers are stuck between a rock and a hard place. They want to invest and adapt but they don’t have the funds or confidence to do so. At the same time, shoppers are holding back as consumer confidence falls and discretionary spend slips away.”
And the June Retail Sales Monitor from the British Retail Consortium and professional services firm KPMG sees total sales decrease by 1.3 per cent in the month, compared to an increase of 2.3 per cent a year previously.
This decline drags the three-month average down by 0.1 per cent while the 12-month average increased by 0.6 per cent – the lowest since the monitor began in December 1995.
Meanwhile, June retail sales decreased by 1.6 per cent on a like-for-like basis from 2018, when they had increased 1.1 per cent from the preceding year, this is lower than the three-month and 12-month average declines of 0.4 per cent and 0.1 per cent respectively, and represents the worst 12-month average since April 2012.
The figures prompted the BRC to describe the state of the UK High Street as “bleak”, although they highlighted that retailers have been helped by online sales, which rose four per cent in June for non-food products compared with a year ago.
“June sales could not compete with last year’s scorching weather and World Cup, leading to the worst June on record,” BRC chief executive Helen Dickinson said, “sales of TVs, garden furniture and BBQs were all down, with fewer impulse purchases being made.
“Overall, the picture is bleak. Rising real wages have failed to translate into higher spending as ongoing Brexit uncertainty led consumers to put off non-essential purchases.”
Over the three months to June, in-store sales of non-food items declined 4.3 per cent on a total basis and 4.1 per cent on a like-for-like basis, which the BRC said was worse than the 12-month total average decline of 2.8 per cent.
Overall non-food retail sales in the UK decreased by two per cent on a like-for-like basis and 2.1 per cent on a total basis which is below the 12-month total average decrease of 0.8 per cent and marked the worst quarterly decline since February 2009.
Helen added: “Businesses and the public desperately need clarity on Britain’s future relationship with the EU. The continued risk of a no-deal Brexit is harming consumer confidence and forcing retailers to spend hundreds of millions of pounds putting in place mitigations – this represents time and resources that would be better spent improving customer experience and prices.”


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