May retail sales hit with “biggest decline on record”

Retail sales
// May retail sales down 2.7% according to BRC-KPMG Retail Sales Monitor
// Like-for-likes down 3%
// Online sales grew 1.5% against a growth of 11.5% last year

Retail sales in May have seen “the biggest decline on record” according to the latest BRC-KPMG Retail Sales Monitor.

On a total basis, sales decreased by 2.7 per cent for the four week period ending May 25, against an increase of 4.1 per cent in May last year.

Like-for-like sales decreased by three per cent compared to the same period last year, when they had increased by 2.8 per cent from the preceding year – making it the steepest like-for-like decline since December 2008.

Meanwhile, non-food item sales have declined by 2.7 per cent on both a total and like-for-like basis, while non-food retail sales decreased by 1.1 per cent both on a like-for-like and on a total basis.

Food sales increased by 0.8 per cent on a like-for-like basis and 1.9 per cent on a total basis.

Furthermore, online sales of non-food products grew 1.5 per cent, which is against a growth of 11.5 per cent in May last year.

Ecommerce penetration rates increased to 30.3 per cent, up from 28.2 per cent in May 2018.

“With the biggest decline in retail sales on record, the risk of further job losses and store closures will only increase,” BRC chief executive Helen Dickinson said.

“May 2019 delivered political and economic uncertainty. Food sales dropped for the first time since June 2016, with further declines in clothing, footwear and outdoor goods.

“With retail conditions the toughest they have been for a decade, politicians must act to support the successful reinvention of our high streets and local communities.

“Business rates remain a barrier, preventing many retailers from investing in their physical space.

“We have a broken tax system, which sees retailers paying vast sums of money regardless of whether they make a penny at the till, and yet the government is failing to act.

“The legislation is falling behind the technological revolution.”

Institute of Customer Service chief executive Joanna Causon said: “May’s poor retail sales are a stark wake up call for brands, in particular within the context of the growth in consumer confidence seen last month.

“For some organisations, the next six months will mean the difference between staying in business, or joining the growing list of retailers closing stores or closing doors forever.

“There will always be a need for us to buy things, but as consumers we are prioritising the when and how of spending far more than we used to.

“In an environment where customer behaviour is rapidly changing and loyalty is hard won and easily lost, any mistakes in that customer experience will result in the end of that relationship.

“Although tempting to hold back in this volatile landscape, now is the time to invest in initiatives that will provide the best end-to-end customer experience, putting service at the heart of the business strategy, before it’s too late.”

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