CBI sees small retail rise for July

High street retailers reported a third consecutive month of rising year on year sales and orders in July. However, growth slowed to a greater extent than had been expected, the CBI said.

In the CBI’s latest monthly Distributive Trades Survey, covering the first two weeks in July, 44 per cent of retailers stated that their sales volumes were up on a year ago, while 33 per cent reported a fall. The resulting balance of +11 per cent was weaker than retailers had anticipated (+32 per cent) for July. Firms also reported growth in orders (+5 per cent), although once again at a much slower pace than had been expected (+21 per cent).

In August, retailers expect both sales and orders growth to moderate further, with both expected to be effectively flat on a year ago (sales +3 per cent, orders -1 per cent).

As well as seeing slower growth, sales continued to be below average for the time of year (-14 per cent), while, relative to expected demand, stock levels also rose (+21 per cent, from +11 per cent in June).

Judith McKenna, chair of the CBI Distributive Trades Panel and Asda chief operating officer, said: "Retailers reported an annual rise in sales and orders for the third month in a row, but the increase was far slower than firms had anticipated.

"The unprecedented poor weather for the time of year did not help, but retailers also expect conditions to remain tough during August. With consumer confidence weak and wage growth remaining sluggish, the longer term outlook for retailers remains challenging."

Only 18 per cent of wholesalers reported a rise in the volume of sales, while 30 per cent saw a fall. The resulting balance of -12 per cent was the first fall in sales since November 2011.

CBI Monthly Distributive Trades Survey_July 2012.pdf (85KB)

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