Published on July 13th, 2021 | by The GC Team0
Best quarter on record for UK retail sales
UK retail sales grew at their fastest rate on record in the second quarter of this year buoyed by the loosening of restrictions, the Euro 2020 championships and, according to the British Retail Consortium, which compiles the data in association with KPMG, the release of pent-up demand built up over previous lockdowns.
As 2020 was a year in which retail was significantly impacted by enforced closures, 2021 figures are compared with pre-pandemic 2019 data (Yo2Y) in order to make meaningful comparisons. The figures for April to June showed sales increasing by 10.4%, the fastest pace since 1995.
On a Total basis, sales increased by 13.1% in June (Yo2Y), against a decline of 1.3% in June 2019, while like-for-like sales rose 17%, following in fall of 1.6% respectively. Online sales play a far greater role in the like-for-like figure, so increased the growth rate significantly.
Online Non-Food sales increased by 31.3% during the month, against growth of 1.5% in June 2019, but the online penetration rate slowed slightly from June 2020’s high of 49.7% to 39.3%.
Helen Dickinson, Chief Executive of the British Retail Consortium, commented on the “exceptional” growth, but added that UK retail is still facing strong headwinds with many retailers still making up for ground lost during the previous lockdowns.
“City centre retailers continue to suffer low footfall and spending as commuters and international tourist numbers remained well below pre-pandemic levels. Consumer comfort with the next stage of the roadmap will be key to the ongoing success of retail,” she said.
“Many customers are looking forward to a return to a more normal shopping experience, while others may be discouraged by the change in face-covering rules.”
Paul Martin, UK Head of Retail at KPMG, remarked that the reopening of hospitality and leisure sectors led to a dilution in consumer spending, adding that “the fight for share of wallet is underway”.
“Whilst the high street saw continued growth in June, with sales up 10%, online sales fell back by 7% compared to June 2020. However, penetration rates for online sales remain much higher than their pre-pandemic levels, suggesting the shift to online is here to stay.
“Retailers are facing challenges on a number of fronts, particularly convincing consumers that it’s safe to shop in store as restrictions around mask wearing and social distancing come to an end.
“With travel now looking to be back on the agenda for summer and Government COVID-19 support packages slowly coming to an end, retailers will be hoping that the feel-good factor from Euro 2020 and lifting of COVID-19 restrictions will give the high street the summer boost it needs.”