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News - 17 July 2010

Retail sales creep up

UK retail sales values rose 1.2% on a like-for-like basis from June 2009, when sales had picked up 1.4%, helped by the heatwave in the second half of the month. This June was slightly less hot, but sunny for most of the month. On a total basis, sales were up 3.4% against a 3.2% increase in June 2009.

Food sales growth was about the same as in May, thanks to the hot weather and World Cup. Clothing and footwear sales growth slowed, as many people had already bought in May’s sun. TVs benefited from the football and outdoor DIY and leisure improved in the sun, but at the expense of indoor homewares.

Non-food non-store sales (internet, mail-order and phone sales) in June were 17.3% higher than a year ago, down from 21.9% in May. But June’s gain was against a similar increase in June 2009, while May’s gain was against a weak May 2009.

Stephen Robertson, Director General, British Retail Consortium, said, "This is decent sales growth, mainly explained by good weather and earlier summer clearances. The performance is better when you remember the comparison is with a similarly strong performance in a sunny June a year ago.

"Barbecue products, salads and ready meals were in big demand. In non-food retailing it was a mixed picture. TVs were really the only football-related item that generated significant spending. Other items, flags and souvenirs, were high profile but relatively low value. Most of the time, minds were outdoors. Homewares and indoor DIY lost out. Garden goods did better. Summer clothing sold less well than the weather might suggest because many people had bought when the sun first arrived in May.

"The Budget is affecting confidence but it won't be until the impact of the measures is actually felt that it really hits spending.”

Helen Dickinson, Head of Retail, KPMG, said, "Trundling along is an apt description for this month’s sales. While the World Cup did impact performance on individual days and provide a welcome uplift for some, it did not shift overall spending patterns much one way or the other. Despite the good weather clothing and footwear did not do as well as in May – and menswear continues to underperform. Furniture and floorings had a better month, although against poor comparatives. While the emergency Budget has delayed any impact of the VAT rise until later this year/early next, the effect of the wider fiscal tightening measures on consumer spending remains to be seen. The risk is all on the downside."

Food & Drink – Joanne Denney-Finch, Chief Executive, IGD, said, “Despite a boost from the World Cup and some hot weather, the better weeks for food and drink sales in June were cancelled out by the poorer ones, leaving the month’s sales growth broadly in line with May’s.

“England’s matches during the World Cup prompted major uplifts, but the exit from the competition slowed food and drink sales growth in the last week of the month.


Read related items on:
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British Retail Consortium
Dickinson, Helen
Robertson, Stephen


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