Published on July 29th, 2021 | by The GC Team0
Retailers keep shop prices low in July
Shop Price deflation accelerated to 1.2% year-on-year in July compared to June’s decrease of 0.7% due to a steeper fall in non-food prices adding to competition between supermarkets keeping food prices low.
According to the British Retail Consortium, the reopening of some holiday destinations and other recreational activities meant consumers broadened their spending to include more leisure and travel. In response, non-food retailers have been working hard to hold consumer interest, including with summer sales.
But, as Helen Dickinson, Chief Executive of the organisation, says: “Unfortunately for consumers, low prices may not last forever.”
Retailers have faced huge cost pressures as a result of the rising costs of shipping, haulage and petrol as well as frictions from exiting the EU, and as Dickinson points out: “The additional paperwork and physical checks on EU imports in October and January may push prices up in the long term.”
According to Mike Watkins, Head of Retailer and Business Insight at NielsenIQ, recent research shows 41% of all shoppers are watching their spend more than they did before the pandemic, indicating an uncertain time for many households as the economy slowly reopens.
“So,” he says, “it’s important that retailers continue to keep prices low, especially as the increase in CPI is likely to lead to different shopping behaviours to help pay for the other increases in household spend.”