Published on April 10th, 2018 | by The GC Team0
‘Beast from the East’ drives non-food purchasers online
Online sales of non-food products rise 7.9% in March while high street bears brunt of winter chill
Figures released today by the BRC and KPMG show that retail sales increased 1.4% on a like-for-like basis in March, despite disruption caused by the cold weather fronts that hit much of the UK. The rise compares to a year-on-year fall of 1% during the same month last year.
On a total basis, sales rose 2.3% against a decline of 0.2% in March 2017.
The British Retail Consortium called the run-up to Easter a “roller coaster ride.” Chief-Executive Helen Dickinson said: “March paints a volatile picture for sales, which experienced peaks and troughs to deliver some modest growth on last year. The positive distortion from the timing of Easter pushed sales up by over 15% during the holiday week compared with the rest of the month, only just making up for a sub-zero performance at the start of the month.
“There’s no doubt that the ‘Beast from the East’ and its successor played a significant role in deterring shoppers from making store visits. But it didn’t dampen consumers’ appetites towards food purchases, which saw the anticipated spike from the Easter festivities. This was in stark contrast to non-food sales which, despite some promotional-driven activity, bore the brunt of consumers’ disinterest in typical Springtime purchases, as well as the ongoing spending squeeze on non-essentials.”
Over the three months to March, in-store sales of non-food items declined 3.0% on a total basis and 4.0% on a like-for-like basis, while all non-food sales over the same period decreased 1.8% on a like-for-like basis and 1.0% on a total basis.
Online sales of non-food products during March showed strong growth, however, up 7.9% against a rise of 6.6% in March 2017. This is above the 3-month and 12-month averages of 6.6% and 7.8% respectively.
The online penetration rate also increased in March, from 20.6% last year to 22.0%.
“March was difficult for large parts of the UK retail industry,” said Paul Martin, Head of Retail at KPMG. “Seemingly endless cold weather dissuaded would-be shoppers from the high street and a number of retailers delivered bad news. Great hopes were placed on Easter trading, but whilst the latest figures point to overall improvement when compared to recent months, the Easter boost didn’t quite measure up to previous years.
“The divide between food and non-food sales became further pronounced, with food clearly the winner. This came at the expense of other categories, with few others noting growth. Retailers with an online presence were far more fortunate, with a marked lift in all categories.
“The start of 2018 has already seen a list of casualties, and with trading conditions unlikely to change in the short-term, retailers are increasingly having to be clear on their point of differentiation.”