Heat wave drives strong retail sales in July

Sales rose 3% year-on-year which represented the fastest annual rise since January 2011 as sentiment improved on the high street.

The grocers enjoyed a strong month as sales rose 2.5% in July month on month with sales of barbeque food and alcohol up.

The ONS said the price of goods rose 1.8% year-on-year driven by a rise in food prices.

In July, the estimated weekly spend across all retailing averaged £7bn, up from £6.8bn in June and £6.7bn in July 2012.

BRC director general Helen Dickinson said: “These are very strong sales figures, and they demonstrate just how well retailers have responded to the recent good weather. By giving customers what they want to enjoy the summer and running the right promotions at the right time, they have driven good sales across the board.

“These results today add to the signs we are seeing of a tentative recovery taking hold. UK retailers still face significant challenges, but the outlook is gradually improving.”

UK head of retail at Deloitte Ian Geddes said: “The recovery is building momentum. This is the third consecutive month-on-month rise and while we do not expect a return to pre-recession levels of consumer spending growth, there are increasing signs that purse strings are just beginning to loosen. 

“This positivity needs to be tempered slightly due to the weak comparable figure from last year but coupled with positive news from elsewhere in the economy, retailers will begin to take some confidence that this recovery can be sustained through the rest of the year.”

PwC chief retail adviser Christine Cross said: “Sunshine, confident statements from the new Governor of the Bank of England plus a slight lift in the housing market, have done wonders for consumer confidence. The apparel and general retail merchandise sector seem to have benefitted, with encouragingly strong sales for the majority across both physical stores and online, the latter still leading.

“Many retailers are now coming to ‘the inflexion point’ of 20% non-food sales online or 10% food sales online which means the business model needs to change. Shopping anytime, anywhere, through any channel - ‘total retail’ - requires a long hard look at the property portfolio, supply chain and organisational design in order to deliver increased customer focus and increased profit too. Retailers addressing the challenge now are realising the benefits.”