37 DATA SALES REVIVAL REMAINS ‘ILLUSORY’ ,


Strong evidence that would point towards a sales revival is not showing up in the numbers according to the latest Retail Sales Monitor from the British Retail Consortium and KPMG. The figures for February show


that UK retail sales values were down 0.3 per cent on a like-for-like basis from February 2011, when sales had fallen 0.4 per cent. On a total basis, sales were up 2.3 per cent, against a 1.1 per cent increase in February 2011. Food sales picked up, helped by


shoppers stocking up in the very cold weather but this was offset by non-food sales weakening further, despite continued promotions and discounts. For clothing, footwear and


homewares, February was worse than January and December, especially for larger purchases. Non-food non-store (internet,


mail-order and phone) sales growth slowed further after picking up sharply in December. Sales were 9.9 per cent up on a year ago, down from 11.3 per cent in January and 18.5 per cent in December and also below the 10.4 per cent in February 2011.


“The reality of weak sales shows


that a convincing revival remains illusory,” says Stephen Robertson, director general, British Retail Consortium who added that any sense of improving optimism is not yet translating into more spending.


Month


“Falling inflation has eased the squeeze on household finances and halted the slide in consumer confidence but that’s at risk from fuel price rises and Budget uncertainty. Unemployment is expected to rise further causing increased nervousness about job security, which is keeping confidence fragile. “Total sales growth is still below


inflation, so overall customers are actually buying less than a year ago, while discounts are eating into margins. Food picked up but non- food sales deteriorated with goods affected by the slow housing market particularly struggling. In this climate of continued caution, the Chancellor must use the Budget to hold back business costs, which will support jobs, growth and the much-needed consumer turnaround.”


Helen Dickinson, head of retail,


KPMG, said: “February’s results were similar to January’s but with very different dynamics. Food performed better than in the previous month but many non-food sectors struggled. The timing of half term caused plenty of variability during February and swings in performance by individual retailers makes business planning all the more challenging. “Consumers remain reluctant


to spend unless encouraged by promotional activity. Thus, while the market is still growing slightly in headline sales terms, profitability continues to be eroded through loss


RETAIL SALES VALUE: Percentage change year-on-year 2010


January February March April May June July


August


September October


November December


January – July average January – December average


Like for like -0.7 2.2 4.4


-2.3 0.8 1.2


0.5 1.0 0.5 0.8 0.7


-0.3% 0.2


-0.8 Source: BRC-KPMG RSM (food & drink data from IGD)


Total 1.2 4.5 6.6


-0.2 3.0 3.4 2.6 2.8 2.2 2.4 2.8


1.5% 2.7


1.6


-0.4 -3.5 5.2


-2.1


-0.6 0.6


-0.6 0.3


-0.6 -1.6 2.2 0.7 1.4


2011


Like for like 2.1


Total -0.3 1.1


-1.9 6.9


-0.3 1.5 2.5 2.5 2.5 1.5 0.7 4.1


2.5 3.3


0.8% 2.8% 0.3


of margins. “Many retailers feel they’re


fighting very hard just to stand still at best and don’t see any light at the end of the tunnel. However, there are retailers out there who deliver what the customer wants and needs – in terms of product, brand and price – which proves that if the proposition is spot on it is still possible to outperform the market and the competition.” On the food & drink sector Joanne Denney-Finch, chief executive of IGD, said: “These results are an improvement on January and a sign that consumer confidence is heading in the right direction. Our research shows that, although half of shoppers (47 per cent) still believe they will be worse off in the year ahead, this is a more positive picture than last year – when 61 per cent felt this way. “With the exception of the snowy


start to February, the winter as a whole has been milder than in recent years – which has been good for sales. Valentine’s celebrations also provided a modest boost.” On the non-food non-store sales


Robertson of the BRC said: “Non- food sales have been worst affected by customers’ continuing fears about their own finances and prospects. That’s being felt online as well as in stores but the slowing of online growth may now also be reflecting some maturing of the market.”


2012


Like for like 2.1


Total -0.3 2.3


EAST ENJOYS FESTIVE GROWTH WHILE EU SHIVERS


Consumers across Europe increasingly chose to do their Christmas shopping online, while overall retail sales remained flat over the period, according to new research by global property adviser CBRE. CBRE’s European-wide


annual review of retail sales figures, including both online and traditional shop sales, for the month of December reveals that the ongoing eurozone crisis, falling consumer confidence, and the threat of a double dip recession meant that Christmas trading across Europe was once again flat, growing by just 0.1 per cent year-on-year. Overall retail sales growth (including both online and traditional shop sales) was weakest in the eurozone area, down by 1.6 per cent in December 2011, reflecting consumer nervousness in the member states. In contrast, retailers


enjoyed a successful Christmas period in Russia, with sales increasing by 9.5 per cent in December and by 16.1 per cent in the last two weeks of the month. An emerging middle class


and growing availability of credit increasingly played a role in Russia’s increase, the survey showed. Likewise retailers in Poland had a very good Christmas trading period with overall sales up by 8.6 per cent on the same period in 2010. Retailers in the southern


European countries of Italy, Portugal and Spain experienced the worse decline in sales, reflecting the impact of harsh austerity measures, higher tax rates and very low consumer confidence levels.


www.shopping-centre.co.uk March 2012 SHOPPING CENTRE


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