Retail sales showed stronger growth in July
Data on retail sales for the summer so far seem to be suggesting that the downtown expected from Brexit simply isn’t happening as economists predicted. July sales are up on June’s figures, and show a resilient UK market, although it is the food sales area that appears to be holding it all in place this month. Should retailers be getting exciting, or are these sales figures nothing much to write home about?
Retail sales for July
According to the Office for National Statistics, sales growth from June to July saw a 0.3% increase, as it had in June from May too (despite an earlier calculation of 0.6%, which was later adjusted). Food retail sales went up by an impressive 1.5%, and this was after food sales had actually fallen in June by 1.1%. However, it’s these food sales that helped the overall 0.3%, as all other markets had in fact dropped. The news for individual retailers isn’t always so sunny either, as Kingfisher (the group which owns B&Q) has reported a 1.9% drop in like-for-like sales for the past three months up to 31st July. In fact, B&Q alone has seen sales drop by 4.7% in this period.
A number of factors have suggested an expected downturn in retail sales. This includes a freeze in wages, uncertainty and the tightening of belts in the wake of Brexit, plus increased inflation as a result of a weak pound. However, as usual, the UK market is showing itself to be just resilient enough to answer the naysayers, with annual growth at 4.1% as of July.
Another reason that the figures for retail growth are so unexpected is that increased online shopping should technically be cannibalising high street sales, but for some reason, the markets are managing to be healthy. Retailers are making use of new technologies to entice more customers through their doors, and this includes options such as digital signage from firms like http://moodmedia.co.uk/digital-signage-solutions/.
Economists seem to think that similar, ‘subdued’ growth will continue until next year, when the real effects of Brexit will be understood.
These figures may look good at first glance but should be understood in the wider context. Whilst food sales for this period grew, all other retail sales fell.