Total retail sales grew by 4.1% in December according to the latest figures from the British Retail Consortium (BRC). Growth beat expectations and excluding Easter distortions was the strongest seen this year. The figures were boosted by some one-off factors such as the severe snow disruptions of lastyear, but such strong growth was unexpected and somewhat perplexing considering the continued pressure on household budgets. The BRC suggested that, in addition to the snow disruption of last year, discounting was deeper and started earlier and the vital Saturday Christmas Eve added another big trading day to the final run-up.
Food sales picked up strongly and non-food also improved, but sales were promotion-led and at the expense of margins. The latest round of trading results is likely to reveal the degree of profitability retailers were prepared to give up to drive top line sales.
The non-food non-store (internet, mail-order and phone) sales growth picked up sharply in December, up 18.5% on a year ago, the strongest growth since September 2010. This was a sharp rise on November when sales rose by 8.6%.