UK Electricals Sector Report summary
March 2022
Period covered: Period covered: 30 January – 26 February 2022
Note: This report summary is one or two months behind the current month as standard reporting practice. The content is indicative only and incomplete with certain data undisclosed. Become a member to access this data or take out a free 30 day membership trial now.
Electricals sales fell 00% YoY in February, but were up 00% compared to the same period in 2019, before the onset of the pandemic, according to the Retail Economics Retail Sales Index.
Distortions and desertion
This was the 00 consecutive month of decline for the sector, with growth unable to surpass last year’s 00% rise during the third national lockdown when appetite was strong for computing, household appliances and home entertainment items.
Another headwind hampering performance was the increased pressure on household budgets with CPI inflation accelerating by 6.2% YoY in February, considerably ahead of expectations. It has not been higher in 30 years.
Surging inflation is supporting value growth, with volumes ultimately declining in February. This gap between values and volumes is expected to widen over the course of the year, with inflation now forecast to reach 00% in Q4 2022 according to OBR.
Worryingly, a more pessimistic outlook from the Bank of England suggests inflation could reach double-digits in the final quarter of the year if pressure on energy prices intensifies.
Estimates suggest that inflation rates within the Electricals category are significantly higher than headline CPI, with electrical appliances displaying rates of 00 00% YoY by way of example.
Chipset shortages, lower inventory levels and increased costs within the supply chain are weighing on prices. The ongoing chipset shortage continues to hamper electrical retailers stock inventory levels with delays transporting goods from the Far East exacerbating the situation, although some improvements have been made in recent weeks.
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Online Non-Food spend slides
Source: ONS
