The Retailer Summer 2018_FA_20.07

NEWS FROM THE BRC

BRC – KPMG RETAIL SALES MONITOR June 2018 Beers, barbeques and big screen TVs lift June sales

Covering the five weeks 27 May – 30 June 2018

• Online sales of Non-Food products grew 8.5% in June, against a growth of 10.1% in June 2017. This is below the 3-month average of 9.0% but above the 12-month average of 7.9%. Online penetration rate increased from 22.3% in June 2017 to 23.3% in June 2018. Helen Dickinson OBE, Chief Executive British Retail Consortium “Beer, barbeques and big TVs lifted June’s sales as warm weather and world cup fever gripped the nation. However, with consumers engrossed in the agony and ecstasy of each match, spending on many other items fell. In the end, June scored solid, but not sensational, sales. “The reality is that sales don’t grow on the feel-good factor alone. With household incomes still barely growing faster than inflation, conditions for consumers and retailers remain extremely tough. Things could get tougher: once the euphoria of sporting success subsides, without a deal on Brexit, shoppers face the prospect of significant price increases and shortages of everyday goods.”

• In June, UK retail sales increased by 1.1% on a like-for-like basis from June 2017, when they had increased 1.2% from the preceding year. • On a total basis, sales increased 2.3% in June, against an increase of 2.0% in June 2017. This is above the 3-month and 12-month averages of 1.2% and 1.5% respectively. • Over the three months to June, In-store sales of Non-Food items declined 1.4% on a Total basis and 2.7% on a Like-for-like basis. This is an improvement over the 12-month Total average decline of 2.4%. • Over the three months to June, Food sales increased 0.3% on a like-for-like basis and 1.7% on a total basis. This is below the 12-month Total average growth of 3.7% but includes April, which was negatively distorted by the timing of Easter. • Over the three-months to June, Non-Food retail sales in the UK decreased 0.2% on a like-for-like basis and increased 0.8% on a Total basis. This is higher than the 12-month Total average decrease of 0.1% and the best 3-month average since September. It was the second consecutive month of growth in Non-Food.

BRC – NIELSEN SHOP PRICE INDEX – JUNE 2018

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Helen Dickinson OBE, Chief Executive, British Retail Consortium:

Food inflation cool in the soaring summer Period Covered: 04 - 08 June 2018 • Shop prices fell by 0.5% in June, a significant easing in deflation from May’s decline of 1.1%. This is the 62nd month of Shop Prices deflation. • Non-Food deflation eased by almost a percentage point in June to 1.6% from 2.5% in May. This is the lowest rate of deflation since December 2017. • Food inflation was steady at 1.2% in June, the same level as in May, and above April’s rate of 1.0%. • Fresh Food inflation slowed marginally to 0.8% in June from 0.9% in May. • Ambient Food inflation inched down to 1.6% in June from 1.7% in May.

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“Food shoppers can breathe a sigh of relief with the rate of food inflation remaining steady and retailers continuing to fight back against a tough trading environment with competitive pricing and deals. Changes in global food prices of dairy and cereal as well as higher oil prices will mean this battle looks set to continue in the coming months. “For non-food, there’s been an easing in deflation largely driven by some retailers bringing forward the introduction of new ranges this year. This effect on the index will be temporary and, given the strength of the competitive pressures in the industry, we’re are likely to see non-food prices slide further into deflation in coming months. https://brc.org.uk/retail-insight-analytics

6 | SUMMER 2018 |

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