UK retail sales boosted by Diamond Jubilee
Figures released by the British Retail Consortium and KPMG showed that retail sales rose 1.4% in June on a like-for-like basis from June last year. Total sales were up 3.5%.
The Jubilee celebrations and warm weather helped the trading period get off to a strong start with food and drink, clothing and footwear and online all performing well in the week leading up to Jubilee.
However, the BRC said that the remainder of the month was more challenging as discretionary and big-ticket items continued to struggle as consumers’ underlying caution about the economy, jobs and their personal finances curtailed spending.
Online sales of non-food items showed stronger growth, up 12.1% against growth of 11.5% last year.
Stephen Robertson, BRC director general, said: “It was the bunting boost. June was saved by the feelgood lift of the Jubilee, showing how crucial these temporary factors are in our difficult trading conditions.
“Sadly the soggy celebrations over the Jubilee weekend itself, which heralded the start of the wettest June on record, were followed by far weaker business for the rest of the month. Belts were tightened again and the lower temperatures cooled demand for summer fashions and outdoor leisure goods.”
Helen Dickinson, head of retail at KPMG, added: “In June, following a mini Jubilee boost, most sectors achieved positive like-for-like growth for the month as a whole. However, women’s clothing continues to find the going tough because fashion spending is especially discretionary and we’ve all forgotten what the sun looks like! The double whammy of uncertain sales levels and ongoing promotional activity continues to hit profits and cash flows.
“Retailers are fervently hoping that the summer of sport will raise cash for their coffers. But the reality is that any benefit from the Olympics will probably be concentrated in the South East and provide more of a boost for food than non-food. Overall there will be plenty of hype, a short term blip of benefit, and then back to normality and the challenges that brings.”
The BRC said the scrapping of next month’s planned fuel duty rise would help hard-pressed customers and businesses but added that the government needed to consider “where next” for other costs it controls.
