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May retail sales growth driven by clothing

Retail sales edged up 0.5% on a like-for-like basis in May compared with a year ago boosted by strong clothing sales. On a total basis, sales rose by 2%.

GENERAL MERCHANDISE

May retail sales growth driven by clothing

Retail sales edged up 0.5% on a like-for-like basis in May compared with a year ago boosted by strong clothing sales. On a total basis, sales rose by 2%.

The figures released by the British Retail Consortium and KPMG show that clothing was the best performing category as non-food sales climbed by an annual rate of 3.2% on a like-for-like basis from March to May. On a total basis non-food sales increased by 4.3%.

BRC director general Helen Dickinson said: “Customers took advantage of great summer fashion ranges and clothing sales had their best results since December 2011, performing better than any other category.”

The BRC said there was also a strong momentum in big ticket sales such as consoles and televisions as shoppers felt confident enough in the economy to make purchases that had been on hold, waiting for economic recovery.

Meanwhile, food sales fell by an annual rate of 2.2% on a like-for-like basis from March to May as the major supermarkets cut prices to maintain their market share. When measured on a total basis, food sales dropped by 0.2% which meant they turned negative for the first time since the BRC’s records began in 2008, excluding Easter distortions

David McCorquodale, head of retail at KPMG, said: “The main barrier to recovery is now the grocers’ battle over price. The deflationary effect of these prolonged discounting campaigns, whilst good for consumers, is feeding through to the grocers’ margins and share values. The constant price matching brings into question the long term value of the grocers’ brands and positioning, but in the short term is providing the UK consumer with plenty of options.”

Online sales of non-food products in the UK grew 17% in May versus a year earlier. The Non-Food online penetration rate was 18.7% in May, the second highest recorded, after last November.

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