Retail Sales Decline in May

The ONS has reported on the latest retail sales figures, advising that for the three months to May 2019, both the amount spent and the quantity bought in the retail industry increased by 1.6% when compared with the previous three months. 

When compared with a year earlier, both the amount spent and quantity bought showed growth of 2.7% and 2.3% respectively in May 2019.

As the only measure to show a decline, the monthly growth rate for both the amount spent and the quantity bought fell by 0.3% and negative 0.5% respectively.

The fall of 0.9% in the quantity bought in department stores in the three months to May 2019 was the eighth consecutive month of no positive growth in this sector.

The quantity bought in May 2019 decreased by 0.5% when compared with the previous month, with a strong decline of 4.5% in clothing sales.

The year-on-year growth rate in the average store price for clothing fell for the ninth consecutive month in May 2019 but evidence from retailers suggested that the poor weather may have delayed the sales for summer ranges.

In May 2019, online retailing accounted for 19.3% of total retailing, with an overall growth of 8.2% when compared with the same month a year earlier.  Statistics from the IMRG-Capgemini e-Retail Sales Index, also released today, showed that online retail sales growth suffered the worst growth on record during May.

Deloitte:

Commenting on today’s ONS retail sales figures, Ian Geddes, head of retail at Deloitte, said:

“Month-on-month, May saw both retail sales values and volumes decrease by -0.3% and -0.5%, respectively, following April’s record-breaking warm weather and subsequent spending boost. Compared to May 2018, however, year-on-year sales were up by 2.7% and volumes similarly up by 2.3%.

“In contrast to Easter’s unseasonably high temperatures, early May bank holiday showers put a slight dampener on consumer spending. Food and non-food sales saw some growth of 1.2% and 0.2% but both saw a marked slowdown. Whilst online sales growth remained flat month-on-month, it is up 8.2% compared to the same time last year. This will be welcome news for clothing and footwear retailers, in particular, which continue to face a tough retail environment on the high street.

“Household incomes have remained robust this year with unemployment, interest and inflation rates all remaining low. Such strong economic fundamentals should boost spending, though Brexit uncertainty continues to fuel a gradual decline in consumer confidence.

“The grey clouds that have continued to gather in June may foretell further headwinds for retailers for the rest of the month. Summer’s sales values and volumes will be weather-dependent and retailers will be eagerly awaiting the return of sunshine and warm weather.

“As we head into summer, those retailers that continue to invest in their digital sales and recognise shifting consumer demand for new in-store experiences will be well-placed to face the challenges ahead, whatever the weather.”

Source : Insight DIY Team and ONS

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