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Sales revive but uncertainty remains - BRC
08
Jun '10
UK retail sales values rose 0.8% on a like-for-like basis from May 2009, when sales had fallen 0.8%. On a total basis, sales were up 3.0% against a 0.8% increase in May 2009.

Clothing and footwear benefited from the sunny weather, as did outdoor DIY and leisure. Homewares showed some improvement but big-ticket items often struggled, despite further discounts and promotions, in the face of consumer uncertainty about job and income prospects.

Non-food non-store sales (internet, mail-order and phone sales) in May were 21.9% higher than a year ago, up from 15.9% in April. Although the best since December, May's gain was against relatively weak growth in May 2009.

Stephen Robertson, Director General, British Retail Consortium, said:
“The sunnier second half of May provided a welcome boost to overall sales. The warmer weather combined with discounts and promotions encouraged spending on clothing, footwear, outdoor DIY and gardening.

“The run-up to the World Cup helped sales of televisions, though this was largely discount-driven. With the tournament getting closer, there should be a further uplift and to other football merchandise such as flags and replica kits. After April's dip, food sales growth returned to more normal levels.

“Consumer confidence has clearly improved since last year's lows. But there's still plenty of uncertainty, which is making customers nervous about buying expensive goods, such as furniture, despite widespread reductions. This month's emergency Budget should provide more clarity.”

Helen Dickinson, Head of Retail, KPMG, said:
"May's results are more indicative of the underlying trend as the last couple of months were impacted by the timing of Easter. The election campaign didn't shift consumer spending patterns much either one way or the other but whether the forthcoming Budget will be more damaging remains to be seen and many retailers remain reliant on promotional activity to drive footfall and sales. While clothing and footwear overall had a good month, women's clothing continued to underperform in this sector as a whole. However, furniture and floorcoverings was once again the worst-performing sector, highlighting the reluctance of consumers to commit to big-ticket purchases while uncertainty over the future looms."

Stephen Robertson, Director General, British Retail Consortium, said:
“This is excellent sales growth – the highest since December. Customers took advantage of the many online deals and promotions, especially on televisions in the lead-up to the World Cup, as well as clothing and footwear.

“But we've got to put these figures into context: it's compared with last year's very weak performance – the lowest growth for at least 18 months.”

British Retail Consortium

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