A survey shows that retail sales have fallen for the past six months and then again in March. This is the longest run of declines outside the Covid-19 pandemic.
The survey conducted by BDO, an independent consultancy, revealed that total in-store and internet sales dropped by 2.2% last month. This is the sixth consecutive month of falling retail sales.
The March decline in retail sales indicates that the wet, windy weather kept consumers away from the high streets over the Easter weekend.
Sophie Michael, BDO’s head of retailing and wholesale, stated: “These results paint a bleak image for retailers.” These results are a stark reminder that the retail sector is under pressure, despite the fact that both Mother’s Day and Easter weekend fell in March.
BDO’s data suggests that the Office for National Statistics estimates of retail sales will show a decline in March, after flatlining in the preceding month. Recently, there have been several insolvencies including The Body Shop and Ted Baker.
Homewares performed especially poorly last month. The category fell by 10.9%, its worst monthly performance since May 2022.
Fashion was the only non-store category to have positive results in March, but a growth of 1.5% failed to offset a decline in in-store sales which fell by 6.5%.
BDO reported that the overall retail sales volume fell due to a weak demand for household products, but fashion and lifestyle items were one of the few categories where sales volumes increased.
The cost of living crisis is still affecting household finances, and living standards are not expected to return to their pre-pandemic levels until next year. In October 2022, inflation reached a record high of 11,1 per cent. Interest rates also rose to 5,25 per cent – the highest level in 16 years.
, the company that conducts research, has measured the consumer confidence as a teetering over the last few months .
Separate research conducted by the British Retail Consortium (BRC) and SensormaticIQ revealed that retail footfall fell by 1.3% on an annual basis during March. This was primarily due to a 3.5% decline in retail park visitors. This was a rebound from the 6.2% annual decline in retail footfall that occurred in February.
According to the British Retail Consortium and Sensormatic IQ, the UK’s decline in retail footfall in March was primarily due to shoppers in England not visiting shops. Visits fell by 1,6%. Footfall increased by 0.4% and 4.0% in Wales and Northern Ireland, respectively. It decreased by 0.94% in Scotland.
Andy Sumpter of Sensormatic Solutions said: “The choppy nature in which footfall has recovered over the last few months indicates that the consumer confidence has yet to fully turn the corner. This may mean we will see a bumpy improvement in shopper traffic for the months ahead.”
Several important economic indicators indicate that the UK’s economy is improving. The UK’s gross domestic product (GDP) returned to growth in January. Although it was slightly down in March, the most recent purchasing managers’ index indicated that the private sector activity increased for five consecutive months.