UK Retail Sales Report summary
August 2021
Period covered: Period covered: 04 – 31 Juy 2021
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. Subscribe to access this data or take out a free 30 day subscription trial now.
Retail sales rose by 00% in July YoY according to the Retail Economics Retail Sales Index (value, non-seasonally adjusted, exc. Fuel); and rose by 7.9% against 2019 levels.
Retail sales softened following the lifting of restrictions and further opening of the economy. ‘Freedom Day’ saw the last remaining restrictions lifted for hospitality, offering consumers a wider array of places to spend their time and distribute their spending.
According to the Bank of England, spending on ‘social’ components of the consumer spending basket (e.g. hotels, restaurants, pubs and air transport) rose by 59.5% in July, compared with the previous year.
There appears to be a digital divide opening up within the grocery sector. Those households who have become accustomed to the convenience of online have embraced this as a permanent shift, ordering regularly and spending on average more than two-thirds of their total grocery expenditure through this channel (Kantar).
Clothing sales rose markedly on last year (+00% YoY, 00% Yo2Y), albeit against soft comparisons (-22.9% in 2020).
Interestingly, the ONS reported online apparel sales rising just 6.6%, the second weakest since May 2020.
In July, online accounted for 00% of food sales compared with 5.2% in July 2019.
One of the biggest challenges for the retail industry in the coming years will be the impact of the shift towards online on profitability.
Even before Covid-19, UK retail market profitability was already under pressure, particularly within the last five years (below).
Over the last five years, pre-tax profit margins have almost halved from 00% to 00%.
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CBI - Retail DTS
Source: CBI
