April a mixed bag for UK retailers, BRC, KPMG research
UK retail sales came in below expectations in April as the sunshine over the Easter weekend persuaded many to pursue recreational activities, according to research by the BRC and KPMG. Department stores, as well as clothing and footwear shops, were harder hit by the warmer weather, while food-to-go fared much better from it.
Like for like sales were up 3.7% year-on-year, although we should be mindful of the distortion caused by Easter’s timing. Online accounted for a little under 30% of all non-food sales, and the BRC expects this proportion to continue to rise. Nonetheless, the pace of growth has slowed over the course of the year despite the investment that many stores have made in their digital offerings.
“Retailers are continuing to invest in technology across both physical and online activities as they seek to meet changing consumer behaviours, however some of such spending is being held back by the plethora of Government-imposed business costs bearing down on the industry,” says Helen Dickinson, Chief Executive, British Retail Consortium. “Government should review these costs – and in particular reduce the burden of business rates – if they wish to see retail maintain its place as the main provider of highly valued, flexible jobs in communities up and down the country.“
Paul Martin, Partner, UK Head of Retail, KPMG, comments: “April may have eased the strain on retailers somewhat, but we can’t overlook the fact that the new tax year also presents retailers with additional costs ranging from increased minimum wages to additional pension contributions. The task of balancing sales and a profitable margin remains crucial, especially given the widespread promotional activity currently.”
