The British Retail Consortium (BRC) has announced retail sales increased by 0.3% during July, the lowest figure recorded for the month of July since its records began in 1995.
Bearing in mind sales increased by 1.6% in July last year, this gives a stark indication of the challenges the retail industry is currently facing. To top it off, the results follow after the worst June, and currently worst 12-month period, on record, too.
UK retail sales increased 0.1% like-for-like from July 2018, where they had increased by 0.5% the previous year. Meanwhile, over the three months leading up to July, non-food retails sales in the UK decreased by 2% on a like-for-like basis (2.1% total), below the 12-month average total decrease of 0.6%. Despite this, non-food was still in growth year-on-year for the month of July.
And it’s not all bad news, as online sales of non-food products grew 3.7% in July, with the 3-month and 12-month average growths recorded at 3.1% and 4.7% respectively. Another indication, perhaps, of the direction in which the future of retail is heading and the growing prominence of e-commerce. In fact, a new report has predicted over half of retail sales will take place online within the next 10 years.
Helen Dickinson OBE, BRC Chief Executive, attributed slow real wage growth and Brexit uncertainty for languishing consumer spending. She also acknowledged the UK’s summer this year has been weak in comparison to last, which saw good weather and World Cup Finals to tempt consumers into spending.
“While retailers will welcome the return to growth, it has nonetheless been a punishing few months for the industry,” she said. “The challenging retail environment is taking its toll on many high street brands who must contend with rising import costs, a multitude of public policy costs, and ever higher business rates.
“A coherent strategy for retail is needed. The Government should freeze future business rate rises and fix the appeals system before embarking on a wholesale reform of this broken tax system.”