Garden centre October sales match overall retail performance

UK retail sales fell in October, according to the British Retail Consortium.

October saw retail sales flag - image: HW
October saw retail sales flag - image: HW

Sales at stores open at least 12 months, measured by value, fell 0.6 percent from a year earlier.

Garden centre sales were just 0.43 per cent down, according to the Garden Centre Association.

Sales of furniture and food were also hit. 

"This is evidence of the basic weakness of consumer confidence and demand and worrying this close to Christmas," BRC director General Stephen Robertson said in a statement.

"It’s clear customers are cutting back whatever they’re buying."

The National Institute for Economic and Social Research said last week that the UK economy faces a 50 percent risk of slipping back into recession. Consumer confidence has weakened as inflation outpaces wage growth, the government cuts spending and the escalating crisis in the euro area threatens the economic outlook.

The BRC report showed that in the three months through October, food sales rose 1.8 percent on the year on a like-for- like basis, while non-food sales fell 1.8 percent.

Robertson added:  "Which part of the wave we're riding varies from month to month but the water is consistently chilly. For a fifth month, total sales growth continues its strangely regular flip-flopping between 2.5 and 1.5 per cent. But, the year-to-date figure, which smooths out these minor moves, is unchanged from the previous month. This is evidence of the basic weakness of consumer confidence and demand and worrying this close to Christmas.

"Underneath the headline figure, the year-to-date results show almost no growth in non-food sales. Allowing for the VAT rise since last year, that suggests a substantial drop in sales volumes while the food figures indicate very little volume growth. It’s clear customers are cutting back whatever they're buying.

 

"A lasting lift in consumers' mood needs a sense that better times will come for jobs, costs and incomes. The Chancellor should use this month's Autumn Statement to help customers and businesses by offering hope over next year's planned fuel duty and business rates increases."

 

Helen Dickinson, head of retail, KPMG, said: "With so much uncertainty across European and global markets, UK consumers remain reticent as their personal finances become harder to manage.

 

"The beginning of the month continued with the trend we saw at the end of September: the warm weather helped to boost food sales to the detriment of clothing and other non-food sectors.  By the end of the month the gap narrowed, food growth slowed and non-food retrieved some of the momentum lost over the previous few weeks. The month overall saw ongoing challenges for big-ticket items and continued high levels of volatility across individual weeks and different sectors. 

 

"But one constant remains: to whatever extent sales are being made, margins and hence profits are being impacted to stimulate demand as retailers strive to cope with the new reality. The success of the Christmas season for retailers hangs in the balance as October’s results do not set a strong foundation." 

 


On food and drink– Joanne Denney-Finch, chief Executive, IGD, said: "Food and drink sales received a boost at the start of the month, benefiting from the tail-end of the Indian summer, but this wasn’t sustained over the following weeks.

 

"The constant trickle of negative economic news, such as the euro crisis, has not helped to improve consumer sentiment. Shoppers are watching every pound they spend and, with thoughts turning to Christmas, they may be making some sacrifices now in order to end the year on a high. Our latest ShopperTrack research shows six in ten shoppers (61%) intend to spend more or the same as last year on food and drink over the festive period."

On non-food non-store (online) Stephen Robertson said:

 

"Online sales growth is up on September and still beating store sales performance by a wide margin but mounting pressure on customers' disposable incomes has noticeably weakened the underlying pace of that growth. In the 12 months to this October it averaged 12.1 per cent, noticeably less than the 17.2 per cent over the 12 months before that. The basic expansion of internet shopping continues but sales values are not rising as quickly as they were because customers don't have money available and, even where they do, are less likely to buy goods that aren't on special offer."  


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