Retail sales decline as stretched shoppers rein in non-food spending

Retail sales volumes including fuel dropped 4.9% year-on-year in April according to the latest data from the Office for National Statistics (ONS). Excluding fuel, sales declined 6.1% year-on-year on a volume basis.

In comparison with pre-pandemic levels recorded in February 2020, sales volumes were up 4.1% and 4.8% including and excluding fuel respectively.

On a values basis, sales including fuel rose 4.5% year-on-year, and increased 1.3% year-on-year excluding fuel.

On a monthly basis retail sales volumes rose 1.4%, driven by a 2.8% uplift in food store sales. However, the ONS said that this uplift was primarily driven by higher spending on alcohol and tobacco in supermarkets, and that food sales were broadly unchanged.

Online sales volumes across non-food categories rose 3.7% in April on a month-on-month basis, led by stronger clothing sales, but in-store sales volumes in these categories across declined 0.6% on a monthly basis, exacerbated by a 0.5% fall in household goods stores.

On a three-month basis sales volumes fell 0.3% compared to the previous quarter, marking the continuation of a downward trend that began last summer.

BRC chief executive Helen Dickinson said: “Retail sales are being squeezed by a combination of low demand, high inflation and rising costs. The fall in demand comes as consumers reign in their discretionary spending following a significant reduction to real incomes for households across the UK. Meanwhile, retailers face higher food and commodity prices, increased shipping and transport costs, and the tightest labour market in decades.

“Retailers are working hard to support their customers by keeping costs down where they can, and expanding affordable ranges, however it is impossible to mitigate all the costs coming through their supply chains. Until inflation is brought to heel, and consumer confidence returns, retailers could be in for some difficult times ahead, with lower demand and reduced margins.”

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