Retail Sales Rise as Consumer Confidence Trickles Back

According to the latest edition of the BRC-KPMG Retail Sales Monitor, which covers the period of August 30th to October 3rd, released today:

• UK retail sales values fell 2.8% on a like-for-like basis from September 2008, a month that had seen sales fall 1.5% due to the financial markets turmoil.
• Total sales rose 4.9% in September compared to a year ago, up on the 2.2% and 3.6% year-on-year sales increases recorded in August and July respectively and substantially higher than the 1.0% gain recorded in September 2008.
• The three-month weighted average saw food sales rising 2.9% on a like-for-like basis and 4.7% on a total sales basis, compared to the same period in 2008.
• The three-month weighted average of non-food sales grew 0.8% on a like-for-like basis and 3.0% on a total sales basis, compared to the same period 2008. In particular, clothing and footwear picked up and homewares and furniture sales also rose above last September’s very weak levels as signs of improvement in both consumer confidence and the housing market begin to filter through to shopper psychology.
• Non-food non-store sales, which is internet, mail-order and phone sales, were 11.9% higher in September compared to a year ago, and up from August’s 7.9% growth.

The spectre of postal strikes is now a real concern for online retailers, particularly with the peak selling season approaching fast. In reality postal strikes will likely only accelerate the move by online retailers to alternative parcel delivery services as they seek to avoid strike-prone services beset by petty pay squabbles.

Commenting on the figures Helen Dickinson, Head of Retail at KPMG, said,

“The results for September and the rest of 2009 need to be considered in the light of last year’s performance, which weakened as the year progressed. However, the pick-up in this month’s figures is stronger than expected. Sunny autumn weather and signs of a less gloomy economic outlook have boosted non-food sales, particularly in children’s clothing and footwear, and furniture and flooring. But the results are certainly not a clear sign of underlying strength in consumer spending, given the ongoing volatility in performance – by sector, by retailer and by week for individual retailers. Growth in the value of food sales is continuing to slow as food inflation eases”.

Data: British Retail Consortium [PDF].

Note: The BRC-KPMG Retail Sales Monitor measures changes in the actual value (including VAT) of retail sales from a sample of retailers. The Monitor measures the value of spending and doesn’t adjust for price changes. In the case of price inflation, sales volumes will increase by less than sales values. During periods of price deflation, sales volumes will increase by more than sales values.

Similar posts which may be of interest:

1. London Retail Sales Rise, Confidence Still Fragile
2. Retail Spending Muted as Consumers Remain Cautious
3. Consumers Return With a Vengeance in December, Concerns Still Linger
4. Retail Sales Mixed Bag: Essentials Up, Discretionary Down
5. Food Price Inflation Seen Bottoming as Non-Food Deflation Contracts
6. Average House Prices Rise Again in September, Not Every Region Sees Increases