Retailers suffer subdued October as shoppers hold back ahead of Black Friday
Retailers suffered a subdued October as shoppers delayed spending ahead of Black Friday and Christmas, figures show.
Total UK retail sales increased by 1.5% year on year, although this was above the three-month average growth of 1.2%, according to the British Retail Consortium (BRC) and KPMG.
Food sales were up 3.2%, down from last October’s figure of 3.5% but also above the 12-month average growth of 3%, helped by cupboard staples seeing a modest boost following Government advice for households to stock for emergencies.
Halloween falling on a Saturday also helped drive spending on snacks, costumes and decorations.
Non-food sales were flat, with big ticket categories such as furniture and white goods performing badly as customers waited for November and its Black Friday deals.
BRC chief executive Helen Dickinson said: “Retailers are hoping pent-up demand translates into stronger spending through November and December, as they work hard to deliver great choice and value for households this Christmas.
“But shoppers and businesses face mounting costs, including rising interest rates and energy bills, adding to the pressures already pushing up prices.
“Government must move faster to cut back the taxes and regulations making it harder for retailers to keep prices down.”
Linda Ellett, UK head of consumer, retail and leisure markets at KPMG, said: “Clothing and footwear purchases grew in October, along with cosy essentials like duvets, as temperatures lowered and storms finally blew in the start of autumn and winter season for retailers.
“But with consumers facing higher household costs, caution ahead of the Budget, and some waiting for Black Friday deals, overall sales growth was modest.
“Nonetheless, growth will be welcomed by a retail sector that desperately needs to offset cost increases with some strong sales as the promotional and festive season gets into full swing.”
Separate figures from Barclays suggest retail spending grew just 0.5% in October as shoppers made more purchases in some categories but spent less overall.
Clothing transactions rose 5.2% while spending fell 1.8%, pointing to more frequent but lower-value purchases, according to the bank’s data.
It found consumer card spending grew 2.3% year on year in October, up from 2% in September and the highest growth since July last year.
Essential spending rose 3.1%, up from 2.5%, as fuel spending climbed 22.7% after diesel passed £2 a litre for the first time.
Non-essential spending grew 1.9%, up slightly from 1.8%, with entertainment performing strongly.
All five of the bank’s measures of consumer confidence dipped in October in the run-up to the Chancellor’s Budget on October 28.
Confidence in the UK economy slipped to 23% from the previous month’s 26%, while consumers’ confidence in their ability to spend on non-essentials fell to 50% from 54%.
Jack Meaning, chief UK economist at Barclays, said: “As the squeeze on consumers’ spending power begins to build, it is reassuring to see resilient numbers in October, albeit alongside signs that consumers are becoming more cautious and that the summer optimism over the economic outlook is starting to fade.
“While the Chancellor’s cost-of-living measures look set to provide welcome support for people at the margins, the survey mirrors our own assessment that, for many, they do not fundamentally change the outlook for the year ahead.”
Published: by Radio NewsHub