UK fashion retail had a tough time in March, facing challenges as consumers held back on spending on non-essential items even with the boost from Mother’s Day and warm weather. The latest BDO High Street Sales Tracker revealed that in-store sales only saw a meager 4.8% increase, disappointing retailers hoping to bounce back from last year’s sharp decline of -10.1%.
Last year, severe snowstorms had hit the UK, causing a significant decrease in physical retail sales. While this year did see a rise in sales, it wasn’t enough to fully revive the sector. In the fashion industry, there was an 8.2% increase, but it fell short of recovering from the 12.7% decline of the previous year. The lifestyle sector also struggled, experiencing a 2.7% decrease in sales.
On a more positive note, online sales continued their upward trend, climbing by 18.7% in March. This growth underscores the ongoing shift towards digital shopping channels, presenting a challenge for traditional brick-and-mortar retailers. Despite a sluggish start to the month, online sales picked up during the final week, fueled by last-minute Mother’s Day purchases.
The move towards online shopping becomes particularly evident during gift-giving occasions, underscoring the waning significance of physical stores during key shopping periods. Sophie Michael, Head of Retail and Wholesale at BDO LLP, pointed out that even with factors like increased foot traffic and rising wages, high street sales still struggled. The overall consumer spending landscape is shaped by inflation and essential purchases, keeping discretionary spending at a standstill.
As retailers brace for higher business rates and staffing costs, they are confronted with additional hurdles in an already challenging market. The persistent growth of online sales and evolving consumer habits emphasize the necessity for retailers to pivot towards digital platforms to maintain competitiveness. Adapting to the changing retail terrain is essential for retailers looking to thrive in the modern landscape.
Useful links:
1. The Guardian: UK retail sector shows signs of recovery in March
2. Retail Gazette: UK high streets record positive sales growth in March
