UK retail sales volumes fall for 4th consecutive month in July: CBI

Retail sales were seen as poor for the time of year in July, but to a lesser extent than in June (-9 per cent from -19 per cent in June). Sales are expected to remain similarly weaker than seasonal norms next month (-6 per cent).

Retailers’ orders placed upon suppliers in the year to July fell at a slightly quicker pace than last month (-13 per cent from -8 per cent in June). The decline in orders is expected to accelerate further next month (-28 per cent).

Internet sales volumes continued to contract in the year to July, at a broadly similar pace to last month (-37 per cent from -38 per cent in June). This marks the sixth consecutive monthly fall in internet sales. In August, the decline in internet sales is set to slow down (-22 per cent), according to the CBI survey.

Stock levels in relation to expected sales were viewed as ‘too high’ by retailers in July (+29 per cent from +12 per cent in June), to the greatest extent since July 2020. Stock positions are also expected to remain ‘too high’ next month (+25 per cent).

Wholesale sales volumes fell in the year to July (-13 per cent from +4 per cent in June) for the first time since March 2021. Wholesalers expect the decline in sales to accelerate slightly next month (-18 per cent.

Martin Sartorius, principal economist, said: “Retail activity continues to take a hit as consumers struggle to cope with the effects of the cost-of-living crisis. For wholesalers, high inflation and weakening economic momentum has meant that sales volumes have now fallen following a solid period of growth stretching back to March 2021.

“The Government needs to act to inspire business confidence and stimulate growth. Fundamentally reforming both business rates and the apprenticeship levy are crucial starting points to encourage investment, which will play a key role in improving living standards in the long-term.”

Fibre2Fashion News Desk (KD)