Your browser is no longer supported. For the best experience of this website, please upgrade to a newer version or another browser.

Your browser appears to have cookies disabled. For the best experience of this website, please enable cookies in your browser

We'll assume we have your consent to use cookies, for example so you won't need to log in each time you visit our site.
Learn more

Warnings over declining health of retail sector

The health of Britain’s retail industry fell during the second quarter of 2017 and is expected to drop further during the third quarter of the year, marking three consecutive periods of decline, according to a leading think tank.

The KPMG/Ipsos Retail Think Tank recorded a Retail Health Index of 82 for the first quarter of the year, but this dropped to 81 for the second quarter of the year. The index base of 100 was set on 1 April 2006.

The think tank warned that these figures would lead to the sector facing its “worst run of health for five years”, with three successive quarters of decline not experienced since 2012. The fall comes as a result of pressure on margins, high street competition and rising costs, including business rates and wage increases.

While June was a strong month for the high street, with footfall up thanks to the sunny weather, the report described this as “too little, too late to save the quarter.”

The unstable economy and political uncertainty were blamed for low levels in consumer confidence, which impacted the results, as did the fact that many retailers’ currency hedging is coming to an end following the Brexit vote last year.

Commenting on the findings, Paul Martin, head of retail at KPMG UK, said: “When looking at the retail sector over the past six months, the discounters and high-end retailers have delivered the best performance. Prolonged discounting and crumbling demand have contributed significantly to the prediction that we are set for the worst run of retail health performance for five years.”

Have your say

You must sign in to make a comment

Please remember that the submission of any material is governed by our Terms and Conditions and by submitting material you confirm your agreement to these Terms and Conditions. Links may be included in your comments but HTML is not permitted.