Published on October 7th, 2019 | by The GC Team0
Shop prices under pressure as spending continues to slow
Low consumer demand and stiff competition has again been cited for pushing down retail prices, as September shop prices fell by 0.6%, the highest rate of decline since May 2018.
Non-Food prices dropped by 1.7% compared to August’s decrease of 1.5%, while food inflation eased to 1.1% from 1.6% in August.
Mike Watkins, Head of Retailer and Business Insight at Nielsen, said: “With consumers feeling uncertain about spending, retailers continue to focus on limiting price increases coming through the supply chain.
“Prices have fallen in non-foods, helped by seasonal reductions, and many food retailers have introduced price cuts to help regain momentum after a challenging summer.”
Chief Executive of the British Retail Consortium Helen Dickinson said consumers may welcome lower prices, but falling demand is squeezing retailers’ already tight margins.
“With business costs continuing to rise – including business rates, wage bills, and pension costs – the high street risks more big-name closures,” she commented.
“Competition for discretionary spend will intensify across all channels as we head towards the end of the year,” added Nielsen’s Watkins, “and we anticipate more promotional savings for shoppers and inspiring media campaigns that help to drive incremental sales.”