Retail sales fall 10% in January

Total like-for-like retail sales declined by 10% in January as both the national lockdown and impact of Covid-19 affected shops across England, according to BDO’s High Street Sales Tracker.

It found that lifestyle total like-for-like sales fell to 16.7% in January. This month’s result reportedly marked “the worst” since June last year and is the second consecutive month of negative total like-for-like sales for the sector.

Fashion total like-for-like sales also dropped this month, falling 12.1% from a “solid base” of 7.7% for January last year. This marks the eleventh consecutive month of negative total like-for-like sales for fashion.

Non-store sales, however, soared to their best result on record in January (132.8%) amid lockdown restrictions impacting bricks-and-mortar outlets. This boost in online activity prevented sales from falling to the depths of the first national lockdown.

Homeware saw sustained positivity, as total like-for-like sales climbed by 6.7% in January from a base of 5.4% for the equivalent month last year. BDO reports that total like-for-like sales for homeware have continued to “stand apart” from other sectors as it logged its ninth straight month of positive sales.

Sophie Michael, head of retail and wholesale at BDO, said: “You would normally see positive growth at the start of the year thanks to the post-Christmas sales, but this year retailers experienced a bleak January after a very lacklustre Christmas.

“Recent administrations point to a squeeze on the middle market. With unemployment set to rise further, the hit to discretionary spend will likely push shoppers towards value retailers and ever-growing online retail platforms, putting further pressure on the midmarket.”

She added that the future for retailers is “currently clouded by uncertainty” with “significant challenges” ahead.

Michael said: “Retailers have the additional problem of predicting how and when consumers will return, and at what level of spending. Added to this, consumers are already displaying potentially lasting new shopping habits and varying product preferences, across all age groups.”