According to the Office for National Statistics (ONS), retail sales in the UK saw a decline last month, including a decrease in the fashion sector. While clothing sales had been performing relatively well this year, the latest data from the ONS reflects a weak month for both the fashion industry and retailers overall.
In June, retail sales volumes dropped by 0.1% compared to the previous month, following a decline of 0.8% in May. On a year-on-year basis, sales volumes were down by 5.8%. It is worth noting, however, that sales volumes remained 2.2% higher than the levels recorded in February 2020, before the impact of the coronavirus pandemic.
On the other hand, retail sales values increased by 1.3% on a monthly basis and 4.4% compared to the previous year. This growth can be attributed to inflation, as retail sales values were up by 14.4% compared to February 2020. Inflation has been steadily rising throughout the year and is currently approaching double digits.
The decline in retail sales volumes can be attributed to a decrease in sales at non-food stores, particularly clothing stores, which saw a 4.7% drop. Household goods retailers, such as furniture stores, also experienced a decline of 3.7%. Despite these decreases, sales volumes at non-food stores remained 1.4% higher than in February 2020. Some retailers have suggested that the recent rail strikes at the end of June may have negatively impacted their sales, as fewer people were traveling into city centers on those days.
Department stores also saw a decrease in sales volumes of 0.6% compared to the previous month, with sales volumes 5.3% below February 2020 levels. Meanwhile, sales volumes from non-store retailers, predominantly online retailers, fell by 3.7% but remained 20.8% higher than in February 2020. In June, online retail sales accounted for 25.3% of total retail sales, the lowest percentage since March 2020. This continues the trend of online sales decreasing from their peak of 37.4% in February 2021.
Specifically, online sales for department stores decreased by 8.7% year-on-year, while online sales for textile-clothing and footwear stores were down by 4.8%.
Silvia Rindone, UK & Ireland Retail Lead at advisory service EY, commented on the situation, noting that rising costs and decreased consumer confidence are impacting consumers’ spending habits. This decline in consumer confidence is now affecting retailers’ financial performance.
In conclusion, the ONS figures reveal a decline in retail spending in the UK, including in the fashion sector. Rising inflation and decreased consumer confidence have clearly had an impact on retailers’ sales. In light of these challenges, retailers will need to develop strategies to navigate the changing landscape and meet the evolving needs of UK consumers.
Useful links:
– BBC Business
– Reuters Retail
