Published on June 23rd, 2021 | by The GC Team0
High Street Retail: A rocky road?
Last week’s retail figures for May 2021 from the Office for National Statistics (ONS) showed a 27% value increase year-on-year, but the data were skewed by the fact that in early 2020 the UK was in the grip of the first draconian Covid lockdown, and, argues delivery specialist ParcelHero, a closer look at the statistics reveals deeper shifts that indicate the return to “normal” on the High Street may be a hard road.
Retail sales unexpectedly fell by -1.4% between April and May, but “that’s only half the picture,” says ParcelHero. “Compared to pre-Covid levels, High Street sales are still down 1.3% but online sales are 58.8% up.
“Retail’s return has hit a rocky patch. The latest retail figures from the Office for National Statistics (ONS) reveal sales values in May were up 27% year-on-year, but unexpectedly fell -0.8% between April and May (and -1.4% in volume).
“A -5.7% drop in food store sales offset the gains seen by non-essential shops after they reopened. Analysts are saying this is largely down to the reopening of restaurants and many hospitality venues.”
ParcelHero’s Head of Consumer Research, David Jinks M.I.L.T., says: “On the face of it, a 27% increase in sales over May 2020 is great news for the High Street. Scratch the surface, however, and a very different picture emerges. Compared to February 2020, the last month before the first UK lockdown, the value of total online retail sales this May was 58.8% higher, whereas in-store sales were -1.3% lower. You cannot blame a 58.8% swing to online sales on people deciding to go out for a pub meal.
“Despite a steep decline of -5.7% for online sales between April and May, they are still 2% up on May 2020 when everyone was being forced to shop online because of the first lockdown. E-commerce now holds a jaw-dropping 28.5% of the entire market. Online sales made up just 19% of the entire retail spend as recently as January 2020, before the pandemic first hit.
“We are seeing an ongoing shift in the way we shop that High Street retailers cannot ignore. ParcelHero’s own independent research reveals 46% of consumers have no intention of spending as much in stores as they used to do pre-pandemic. “While the outlook for town centre retailers is certainly rocky, it’s not a horror story, however. An omnichannel sales strategy, embracing both shop and online sales, with both services complementing each other, will help all retailers claw their way back from the clutches of the coronavirus.”