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Retail sales growth
The KPMG/British Retail Consortium numbers for retail sales growth shows total like-for-like sales growth of 1.7% year-on-year for the second quarter, but with a 0.7% like-for-like decline in non-food sales. A 5.4% rise in food sales is attributed to hot weather.
Total sales growth for the quarter (actually the five weeks to the 4th July — a few days more than a quarter) is positive even for non-food, but the report offers no analysis of the gap.
Another striking feature of the numbers is the continued strong growth in non-store, non-food sales, which were up 16.8%. This means internet, mail order, and phone sales. Obviously like-for-like numbers are not relevant here. Not only does this represent market share lost by stores, but it also tends to put pressure on their margins as they compete with retailers not saddled with the overheads of stores.
The numbers look very positive compared to the last ONS Retail Sales Index (RSI). Although that covers a slightly different period, that does not appear to cover the difference — although June was a good month, it does not look like sufficient to explain the difference. It will be interesting to compare the KPMG/BRC numbers to the RSI for the three months to June, which is due to be released on the 23rd July.
The ONS has the advantage of retailers that it selects being compelled to provide data, whereas the other relies on the voluntary participation of BRC members. The ONS’s RSI can therefore reasonably be regarded as more complete, with a statistically valid sample. The RSI does not, however, provide any like-for-like numbers.
For the moment, the fall in like-for-like non-food sales is a reason for caution, especially until we see what the RSI numbers for total sales growth are like.
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