Late Easter aided strong general retail sales says British Retail Consortium

General retail sales were stronger in April because of the later Easter but the British Retail Consortium and BRC analysis predicts a less rosy outlook.

In April, UK retail sales increased by 5.6% on a like-for-like basis from April 2016, when they had decreased 0.9% from the preceding year, said the BRC.

On a total basis, sales rose 6.3% in April, against flat growth in April 2016. The performance is positively distorted by the timing of Easter and the highest since April 2011, another Easter distortion. This pulls the 3-month average to 2.0%, above the 12-month average of 1.3%.

In garden centres, sales were up on 2016, when Easter was early, but in general were not outstanding outside the planteria, where plant-based centres saw increased sales.

Within overall retail, over the three-months to April, food sales increased 2.4% on a like-for-like basis and 3.6% on a total basis. This is much faster than the 12-month total average growth of 2.0%, the highest since February 2014.

Over the three-months to April, non-food retail sales in the UK increased 0.3% on a like-for-like basis and 0.7% on a total basis, almost in line with the 12-month total average growth to 0.8%.

Over the three-months to April, online sales of non-food products grew 8.2% while in-store sales declined 1.3% on a total basis and 1.8% on a like-for-like basis, roughly in line with the 12-month average decline of 1.7%.

Online sales of non-food products in the UK grew 10.3% in April versus a year earlier, when they fell by 6.6%. This is the fastest growth since November, above the 3-month and 12-month averages of 8.2% and 9.3% respectively. This figure is positively distorted by the timing of Easter.

Over the 3 months to April, online sales of non-food products in the UK grew 8.2% year-on-year, the highest since January. Over the same period, total non-food sales in the UK grew by 0.7%, the first positive 3-month average since January.

In April 2017, Online sales represented 21.6% of total Non-Food sales in the UK, against 21.1% in April 2016. On a 3-month basis, penetration rate was 21.9%.

BRC chief executive Helen Dickinson said: "As expected, the Easter holidays provided the welcome boost to retail sales, which goes some way to making up for the disappointing start to the year. That said, the positive distortion from the timing of Easter was largely responsible for the month’s growth and looking to the longer-term signs of a slowdown, the outlook isn’t as rosy.

"Taking a closer look at the sales figures, consumer spend on food and non-food items is diverging. Food categories continue to contribute the most weight to overall growth, although food inflation has a part to play in this. Meanwhile, consumers are being more cautious in their spending towards non-food products and focussing more on value priced lines.

"Shop prices are still down overall although other items of consumer spending are increasing headline inflation and hence driving a tightening of purse strings. Although today’s figures do indicate that consumers are still willing to spend, with a cocktail of rising costs and slowing wage growth as the backdrop, conditions for consumers will get tougher. The next Government needs to deliver a plan that puts consumers first in its economic policies and the forthcoming Brexit negotiations."

KPMG retail head Paul Martin said: "April’s sales provided a brief period of respite for retailers following a relentless start to the year. However, much of the rise was driven by the timing of Easter and the growing inflationary pressures the sector is facing, rather than a sudden upswing in consumer confidence.

"Food and drink sales soared significantly in April, suggesting that feasts remain at the heart of festive holidays. That said, in the ultra-competitive grocery sector, these growth figures should be taken with a hefty pinch of salt, with margins under significant pressure and profitability remaining a concern.

"The growth in sales of children’s clothes and toys points to parents making the most of school holidays and keeping the kids entertained. Meanwhile, the rise in furniture sales suggests that springtime home improvements have been kicked into gear.

"Looking ahead, retailers need to ensure that this month’s boost doesn’t lull them into a false sense of security. The retail landscape is changing fast and as such, agility and the ability to manage costs will remain critical."

High street sales

BDO, analysing High Street sales, found total like-for-like sales were up by +1.9% in April, but off of a "very weak base" of -6.1% posted for the same month last year, which at the time was the worst month since February 2009 (-8.1%).

Because of the weak base in April last year, the total result this month was the highest seen since September 2015. The late Easter brought mixed fortunes for April’s result, boosting total in-store sales in terms of the build-up to the long weekend, but seeing sales rapidly decline in the post-Easter week that included the Bank Holiday Monday.

Meanwhile, non-store sales posted muted results on both sides of Easter, inhibiting its overall performance this month. April began with total in-store sales up by +2.81% in a fairly warm week one, but off of a poor base of - 9.35% last year. In the week leading up to Easter, sales grew by +9.44% from a weak base of -7.00%. However, in the cooler week following Easter, including the Bank Holiday Monday, sales fell by -1.93% off of a poor base of -8.73%. The final week of the month ended with sales down by -0.96% off of a negative base of -4.34%.

Lifestyle was the star performer in April. Fashion was also in positive territory, but off of a poor base last year. Homeware slipped into the negative, but conversely off of a very strong base in April 2016.  

Overall footfall was up by +2.7% and +1.2% in the two weeks leading up to the Easter weekend, before falling into the negative in the last two weeks of April, down furthest in the last week of the month (- 1.3%). Footfall on the high street was up in the first three weeks of April, with a month high of +5.5% coming in week two, before declining towards the end of the month, and seeing a low of -2.3% in week four. Footfall at retail parks was marginally up in the week before Easter (+0.1%) and more significantly in the week after (+3.0%), as the Bank Holidays particularly benefitted footfall in those retail locations. By contrast, shopping centres saw footfall down in each week of April, with the low of -3.7% coming in the last week of the month.

Online, non-store LFLs were up by +15.1% in April, its lowest LFL sales growth since September 2016 (+12.6%). The result was coming off of a lacklustre base of +16.4% last year. The month began with non-store sales up above the +20% threshold. However, sales fell off to growth of just +8.54% in the week leading up to Easter, followed by two slow weeks to end the month, with sales up by +13.28% and +11.13% respectively.


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