Retail health in the third quarter of 2019 has surpassed the index’s historic low in the UK’s double-dip recession, the KMPG/Ipsos Retail Think Tank has reported.
The retail health index figures reached a record low of 75 in the third quarter of 2019, and is predicted to decline further to 74 in the final quarter. The previous low was 76 in the fourth quarter of 2012.
The health index has not moved in a positive direction since the final quarter of 2015. Think tank members agreed the retail industry has faced a prolonged decline: “The high rate of store closures, business failures, job losses and overall turmoil within the sector has been unprecedented.”
Tim Denison, co-chair of the Retail Think Tank and head of retail intelligence at Ipsos Retail Performance, said: ”The third quarter of 2019 was a desperate period for many retailers. Such consistent retraction in growth and lacklustre sales across consecutive months is quite unusual and paints a bleak picture of ill health plaguing a large proportion of the industry.
“Even online sales were markedly down and many retailers – once celebrated for bucking the downward trend – found themselves in hot water.
”For non-food retail categories there was little deviation away from growing evidence to suggest that consumers are less and less interested in buying new products. Fashion really struggled to win over consumers, with new collections often discounted from launch to get stock moving.
“This approach is clearly detrimental to retailer margins, and, against a backdrop of ever-increasing costs, many players will now be desperate to make up for lost ground in the final months of the year.”