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Consumers continue to waver amid Brexit uncertainty

Clothing sales survived an overall slump in March, thanks to Mothers’ Day, as Brexit uncertainty continues to negatively affect spending.

Total sales decreased by 0.5% for the four weeks to 30 March, compared with an increase of 2.3% in the same month in 2018 as “Brexit continues to feed the uncertainty among consumers”, the BRC-KPMG Retail Sales Monitor shows.

UK retail sales dropped by 1.1% on a like-for-like basis on March 2018, in comparison with an increase of 1.4% the previous year.

In-store sales of non-food items declined by 1.7% on a like-for-like basis, over the three months to March, above the 12-month average decline of 2.1%.

Online sales of non-food products grew 3%, against a growth of 7.9% in March 2018. Non-food retail sales in the UK were consistent on a like-for-like basis over the three months to March.

The sales monitor gave no individual figures for clothing, but the category moved up five places on the total sales ranking compared with March 2018, to fifth place. Although supported by Mothers’ Day, Helen Dickinson, BRC chief executive said shoppers were still cautious to not overspend.

She said: “Retail sales slowed in March, even when the Easter distortions were accounted for, as greater uncertainty caused people to hold off from splashing out. While jewellery, beauty products and clothing purchases were all up to indulge on Mother’s Day, shoppers were generally cautious not to overspend, particularly on larger items.

“Brexit continues to feed the uncertainty among consumers. For the sake of everyone, MPs must rally behind a plan of action that avoids no deal – and quickly – or it will be ordinary families who suffer as a result of higher prices and less choice on the shelves.”

Retail director for the UK at KPMG Sue Richardson said: “March marked a truly disappointing end to the first quarter of 2019 for retailers. Not only did total sales fall 0.5% compared with the same month last year, but no further clarity around Brexit came to light, and shoppers continue to waver.

“Not all categories or channels suffered the same fate though, and clothing generally bagged a welcome reprieve, thanks to more favourable weather – especially when compared with the Beast from the East this time last year.

“Online sales may have performed better than the high street, but the high proportion of sales occurring online actually nods towards the underlying issue of profit pressure. Retailers will be hoping for an end to this sustained uncertainty – it’s clearly not good for business – but times have already well and truly changed, and agility remains the best form of defence.”

Readers' comments (1)

  • darren hoggett

    The BRC make way too much of the relevance of the BREXIT decision. The consumer makes decisions on spending regarding his or her disposable income combined with confidence. Political uncertainty makes little to no difference when it comes to buying clothing, as opposed to larger purchases such as a car or home improvements for example.

    There is still plenty of money out there, but peoples shopping habits have changed and are generally a lot more careful of what they buy, which is good for them and the environment and another reason why retailers have to put their prices up. Footfall will continue to fall and online sales will continue to rise. What nobody knows is if or when that will level off.

    Whatever the political outcome of BREXIT, deal or no deal, there will be no retail boost of any significant degree and we will still be reading the same reports of weak or stagnant trading ad nauseam, so retail needs to get its own house in order, rather than looking for excuses.

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