Better-than-expected retail sales in January and a new survey revealing growing optimism amongst shoppers combine to cast a little light into the retail gloom.
Figures from the Office for National Statistics show that sales in the first month of 2012 rose 4.4% in value year on year, while volumes were up 2%. Compared to the previous month, sales in the UK increased by 0.9%, hot on the heels of a 0.6% rise in December. Household goods showed a 4.8% monthly rise.
Small stores with nine or fewer employees put in an especially good performance, enjoying a 24% surge in sales value over the same month in 2011.
Meanwhile, new research from IGD ShopperVista, which provides a monthly analysis of confidence amongst British grocery customers, shows that increasing numbers of shoppers now think the worst of their financial problems are behind them. Encouraged by falling inflation, says IGD, they are beginning to feel more optimistic about the future.
The survey of over 1,000 food and grocery shoppers, conducted through January, found that the number of shoppers who believe they will be worse off in the year ahead has dropped from 61% a year ago to 47%).
Forty per cent now believe their personal economic situation will be “about the same” over the next 12 months, up from 29% a year ago, while the lowest numbers of shoppers to date expect food prices to get much more expensive over the next 12 months – 21%, down from 33% a year ago.
IGD chief executive Joanne Denney-Finch, said: “While some of these changes are slight, they do represent a shift in shopper sentiment that should be widely welcomed.
“A growing number of shoppers seem to believe that the worst is behind them. They’ve adapted to the new economic reality and are aware that UK inflation may have peaked. Rising food, fuel and utility prices are the main factors that shoppers fear will make them worse off in the future, so good news in this area is helping improve shopper confidence.
“The economic environment remains challenging and we expect 2012 to be a rollercoaster ride for many shoppers. However, with more people becoming used to the way things are, they’re focusing again on values, with 34% saying that quality is extremely important when choosing where to shop for food and groceries – the highest level for more than a year.”