‘More gloom than glitter’ for retail this Christmas: BRC

(Photo by Dan Kitwood/Getty Images)

Food sales increased 5.1 per cent on a total basis over the three months to October, coming above the 12-month total average growth of 1.5 per cent, revealed recent industry figures, suggesting food was in growth year-on-year though retail sales slowed in October.

Releasing the figures, British Retail Consortium (BRC) on Tuesday (8) warned that Christmas this year will be “more gloom than glitter”, calling on the government to freeze rates and reform the broken transitional relief system.

According to figures released by , overall sales increased marginally by 1.6 per cent in October, against an increase of 1.3 per cent in October 2021.  

Over the three-months to October, non-food retail sales decreased by 1.2 per cent on a total basis and 1.8 per cent on a like-for-like basis. This is below the 12-month Total average growth of 3.7 per cent. For the month of October, Non-Food was in decline year-on-year.

Over the three months to October, in-store sales of non-food items increased 1.3 per cent while online non-food sales decreased by 6.3 per cent in October. The non-food online penetration rate decreased to 39.9 per cent in October from 42.0 per cent at the same point last year. 

Helen Dickinson OBE, Chief Executive- British Retail Consortium, stated as the cost of living for consumers continued to rise, retail sales slowed in October.

“With November Black Friday sales just around the corner, many people look to be delaying spending, particularly on bigger purchases. Clothing and footwear, which saw stronger sales this year, declined as the mild weather meant customers held back on buying winter outfits. Meanwhile, electric blankets, air fryers and other energy efficient appliances continued to fly off the shelves as people sought future cost savings.”

“Christmas will come later than last year for many and may be more gloom than glitter as families focus on making ends meet, particularly as mortgage payments rise. Retailers hope the World Cup and Black Friday, will give sales a much-needed boost ahead of Christmas. However, with little sign of cost pressures easing, government action is needed to support households.  

“Retailers face an additional government imposed £800m inflationary increase in their business rates bills next year so the government should freeze rates and reform the broken transitional relief system to alleviate cost pressures that are feeding through to higher prices at a time when people are least able to afford them.” 

Commenting on the recent BRC figures, Susan Barratt, CEO- IGD (Food and Drink sector performance), October’s food and drink sales were driven by inflation with volume sales over the period notably negative.

“Set against a turbulent backdrop with much uncertainty in both politics and the economy, shoppers are feeling cautious and are holding back their spending. The food industry will hope that upcoming events like the World Cup and Christmas will encourage shoppers to loosen the purse strings.

“In this environment, it’s little surprise that our Shopper Confidence Index remains historically low as shoppers contend with increased food prices, lower (real) wages and rising energy bills. More shoppers than ever are switching their focus to saving money on groceries – up to 47 per cent compared to 26 per cent in Oct ’21.  

“Other tactics to save money include reducing spend on eating out with 70 per cent doing this compared to 63 per cent in May ’22 and more shoppers eating lower quality food.”