Published on June 9th, 2020 | by The GC Team0
Retail sales undergo second worst fall in 25 years
May 2020 proved to be yet another bleak month for retailers as the temporary closure of non-essential stores continued under Government restrictions, but online retail continued to reap the benefits of the resulting vacuum.
According to the BRC-KPMG retail sales monitor, total sales fell by 5.9%, a less drastic decline compared to April’s fall of 19.1%, but nonetheless the second worst recorded since the monitor began in January 1995.
Online Non-Food sales increased by 60.2% in May, against growth of 4.4% in May 2019, with the penetration rate increasing from 31.4% to 61.9% year on year.
“While the month showed record growth in online sales, many retailers will be anxious to see whether demand returns to our highstreets when non-essential shops reopen from 15th June,” said Helen Dickinson, Chief Executive of the British Retail Consortium.
“Weak consumer confidence and social distancing rules are likely to hold back sales. Furthermore, there are concerns that if Government support is withdrawn too quickly, shops and businesses will not survive.”
“Some doors may not reopen at all,” said Paul Martin, UK Head of Retail at KPMG. “COVID-19 has acted as an accelerant in the shift towards having less of a physical presence, not least due to the obvious need to radically reduce costs for survival.
“We’re also witnessing historically high levels of sales transacted online – currently over 60% – and while this will ease as more stores open, consumers have formed new habits that will see the online channel continue to be more prominent going forward.”