On a total basis, retail sales increased by 1.3% in October, against a growth of 4.9% in October 2020, according to the British Retail Consortium (BRC)-KPMG’s monthly monitor.
This is below the three-month average growth of 1.7% and the 12-month average growth of 10.2%. But on a two-year basis, total retail sales grew 6.3% during October compared with the same month in 2019.
Online non-food sales decreased by 8.0% in October, against a growth of 39.0% in October 2020. This is below the three-month average decline of 6.1%.
BRC chief executive Helen Dickinson OBE said: “Customer demand is getting back on track ahead of Christmas as sales grew at a faster rate than the month prior, and well above its pre-pandemic levels. As social calendars started filling up with festivities, clothing and footwear sales performed well. Meanwhile, furniture and electrical sales were held back by global logistical issues and microchip shortages. With Halloween heavily curtailed by the pandemic last year, chocolates and children’s costumes sold a treat as families made the most of the occasion.
She noted: “Some people started their Christmas shopping early with beauty advent calendars flying off the shelves and searches for Christmas items ramping up online. Retailers are doing everything they can to offer customers the choice and availability required throughout the industry’s busiest period, prioritising the food and other festive products needed to celebrate.
“Retailers are hopeful that demand will continue right through the golden quarter. However, there are challenges ahead, with higher prices on the horizon compounded by the many increasing costs faced by consumers such as higher energy bills and rising national insurance.”
KPMG UK head of retail Paul Martin commented: “October provided a modest boost for the high street as total retail sales grew by 1.3% compared with last year. Clothing and health and beauty sales continued to dominate at the tills, while demand for home-related purchases declined further and grocers had another poor month with food and drink sales muted at 0.27%.
“Confident consumers are heading to physical stores to make purchases, as online sales fell yet again in October – although with penetration rates at 42%, online shopping remains significantly higher than pre-Covid-19 levels.” He added: “The much-reported squeeze on household spending has yet to materialise, as consumers seem happy to carry on shopping. Limited availability of stock has created strong pricing dynamics, which means we are unlikely to see any big discounting this Christmas, and many retailers will be hoping consumers are willing to buy the most sought-after gifts at any price. With rising costs putting a strain on most retailers, they will be placing all hopes that demand remains strong as consumers plan for a bumper Christmas, shopping early for those much-wanted gifts, and spending more than last year when Christmas gatherings were cancelled. The main concern is now how trade will develop post-Christmas into 2022. “