Published on January 19th, 2018 | by The GC Team0
Retail sales growth falls to lowest level since 2013
The Office for National Statistics today confirmed a significant slowdown in retail sales for 2017 as it released the figures for December.
The quantity bought increased by 1.9% for the whole year, the lowest annual growth since 2013, but the proportion of internet spending continued to rise, with almost one in every five pounds spent online by the end of the year.
After experiencing a decline of 0.8% in 2010 and remaining flat in 2011, sales volumes began to increase steadily up to 2016 when the growth rate reached 4.7%, significantly higher than the 2017 figure released today.
Sales in December increased 1.4% on the same month last year, but fell 1.5% compared with strong sales in November, driven by Black Friday promotions.
ONS Senior Statistician Rhian Murphy said: “Consumers continue to move Christmas purchases earlier, with higher spending in November and lower spending in December than seen in previous years. However, the longer-term picture is one of slowing growth, with increased prices squeezing people’s spending.”
In the latest three months sales volumes increased by 0.4% compared with the previous quarter, and while the underlying pattern remains one of growth, the figure represents the weakest quarterly growth since the decline of 1.2% in Q1 2017.
Dr Felicity Hardley, Senior Lecturer in marketing and business strategy at Westminster Business School, said 2018 may be the year of consolidation in retail.
“The explosion of online businesses in every category means the slice of the market for different competitors is shrinking. For retailers that rely on shifting large volumes to meet profit targets, the likelihood of survival is also getting slimmer. Competitors not only need to think innovatively to compete in both spheres, but may also need to think about how to outlive rivals.”