BRC reports ‘constrained’ consumer spending in September

UK retail sales slipped by 0.2% in September on a like-for-like basis from September 2017, according to the latest statistics from the British Retail Consortium (BRC) and KPMG.

Covering the five weeks from August 26 to September 29, the BRC-KPMG’s September retail sales monitor reveals that on a total basis, sales lifted 0.7% in September against a rise of 2.3% in September 2017.

Over the three months to September, in-store sales of non-food items dropped 2.7% on a total basis and 4% on a like-for-like basis. But food sales rose 2.3% on a like-for-like basis and 3.4% on a total basis.

Online sales of non-food products grew 5.4% in September, against a growth of 10.7% in September 2017. This is the lowest growth since January.

BRC chief executive said Helen Dickinson OBE said: These figures lay bare the difficult operating environment for the retail industry. After a challenging August, constrained consumer spending in September has resulted in the weakest sales growth for five months.

“The retail industry pays a disproportionate amount of tax. It represents 5% of the economy but pays 10% of business tax and almost 25% of business rates. A tax system skewed towards high taxes on people and property is contributing to stores closures and job losses and is stalling the successful reinvention of our high streets.

“Taxes apply to all businesses, so the answer is not additional taxes solely on the retail industry. The Government urgently needs to reduce the business rates burden and create a tax system fit for the 21st century that more fairly distributes taxes right across the economy.”

KPMG UK head of retail Paul Martin added: “Like-for-like retail sales in September were down 0.2% on this time last year – but then last year consumers were remaining more defiant in the face of Brexit and were shopping regardless.

“Grocery continued to perform, but growth in the category retreated in September. The non-food categories however, continued to disappoint. The historically reliable back-to-school push did not elevate apparel sales. Instead the latest tech launches were a rare source for optimism. Online retail continued to fare better. Even clothing sales managed to grab the attention of those browsing the web to refresh their wardrobe.

“The final golden quarter of the year marks the ultimate test for many players. But retailers must also successfully navigate the upcoming government Budget, Black Friday, Christmas, and of course, Brexit.”

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