UK's retail sales increase 1.1% in Feb 2024: BRC-KPMG report

Non-food sales told a less positive story, registering a 2.5 per cent decline year on year over the three months to February. This downturn is markedly sharper than the 12-month average decline of 0.9 per cent and represents a significant reversal from the 3.2 per cent growth experienced in February of the previous year. The month of February alone continued this downward trend for non-food sales on a YoY basis.

The in-store non-food sector also faced challenges, with sales decreasing by 2.3 per cent year on year over the same period. This represents a significant shift from the 8.1 per cent growth seen in February 2023 and falls below the modest 12-month average growth of 0.3 per cent, as per the sales monitor.

Online non-food sales experienced a more pronounced decline of 4.1 per cent year on year in February, exacerbating the downward trend from a 3.1 per cent decline in February 2023. This decrease was steeper than both the 3-month and 12-month average declines of 2.9 per cent, highlighting the ongoing challenges within the online non-food sector.

Furthermore, the online penetration rate for non-food items dipped slightly to 35.7 per cent in February from 36.1 per cent in the same month last year.

“Consumer demand was dampened by the wettest February on record, translating into a poor month of retail sales growth. Not even Valentine’s Day lifted customers out of the gloom, and gifting products that typically sell well, like jewellery and watches, failed to deliver. On the sunnier side, rainy weather did brighten sales of toys, as parents looked for ways to occupy their children indoors,” said Helen Dickinson OBE, chief executive of the British Retail Consortium.

Linda Ellett, UK head of consumer markets, leisure and retail, KPMG, said: “As many households continue to adapt budgets to meet higher essential costs, including higher mortgage rates, consumer reluctance to get out there and start spending is likely to remain in the short term.  With big increases in labour costs and business rates just weeks away, adding to an already stressed cost agenda for retailers, many will be pinning their hopes on some good news in the Chancellors’ Spring Budget this week to help kick start a spending revival on the high street.

“As inflation continues to slow over the coming months and household finances are expected to improve, there is some light at the end of the tunnel for weary households. However, the assumption that having more spending power will lead to more spending isn’t cutting through at the moment, and retailers will continue to face significant downward pressures on demand in the months to come.”

Fibre2Fashion News Desk (DP)