Like-for-like August sales rise 1.8% as optimism continues

‘Robust’ UK retail sales values were up 1.8 per cent on a like-for-like basis from August 2012, when they had decreased 0.4 per cent on the preceding year. On a total basis, sales were up 3.6 per cent, against a 1.6 per cent increase in August 2012.

Food sales rose by 3.5 per cent in the June-August period (+3.7 per cent May-July), with like-for-like growth up 1.4 per cent. Given a very strong July performance, this implies a slowdown in total sales in August.

Martin Beck, UK Economist at Capital Economics said: “While August saw the BRC’s measure of retail sales growth slow a touch, another month of expansion should boost retailers’ confidence that a solid, if unspectacular, rise in consumer spending is entrenched.”

In August, food sales were ranked 8th in terms of trading momentum and the only category to report falling LFL momentum month-on-month due to tough Olympic comparisons. It is understood that the supermarkets traded better in the later weeks of August with cooler weather playing an important role.

Online sales of non-food products in the UK grew 15 per cent in August versus a year earlier, on a weighted basis, representing its best performance this year. This follows the first dip in online sales in July for the first time in 13 years with the hot weather driving shoppers outside.

Sales in furniture and flooring were the most popular category in August and home accessories were number two- likely boosted by summer sales across July and August.

Head of Retail at KPMG, David McCorquodale commented: “After suffering from some of the worst sales on record last year, furniture and flooring sales rebounded this month. It’s a positive sign that consumers feel confident enough about the future to make large scale, nonessential investments in their homes.

“Whether or not these investments are being powered by finance or consumers dipping into their savings remains to be seen – a debt or savings-fuelled spending bubble, of course, would not be sustainable in the long term.”

Source: Retail Gazette
http://www.retailgazette.co.uk/articles/32432-optimism-continues-as-likeforlike-august-sales-up-18