October retail sales slow as consumers delay Christmas spending

Total UK retail sales increased by 2.5% in October, against a growth of 1.6% in October 2022 as consumers delay their Christmas spending in the hopes they can grab a bargain in the upcoming Black Friday sales, according to the BRC-KPMG Retail Sales Monitor. The total sales growth was below the three-month average growth of 3.1% and the 12-month average growth of 4.2%. Food sales increased 7.9% on a total basis over the three months to October, below the 12-month average growth of 8.5%. For the month of October, food was in growth year-on-year. Non-food sales also decreased 1.0% on a total basis over the three-months to October, which is below the 12-month average growth of 0.6%. For the month of October, non-food was in decline year-on-year. Meanwhile, over the three months to October, in-store non-food sales decreased 0.1% on a total basis since October 2022. This is below the 12-month average growth of 3.0%. Additionally, online non-food sales decreased by 2.5% in October, against a decline of 6.3% in October 2022. This was shallower than the three-month decline of 2.7% and deeper than the 12-month decline of 2.9%. The proportion of non-food items bought online (penetration rate) decreased to 36.5% in October from 36.6% in October 2022. Helen Dickinson OBE, chief executive of the British Retail Consortium, said: “Retail sales growth slowed as high mortgage and rental costs further shook consumer confidence. Many households are also delaying their Christmas spending in the hopes they can grab a bargain in the upcoming Black Friday sales. The cost-of-living squeeze meant more was spent on lower-price indulgences, such as beauty products – the so-called ‘Lipstick Effect’. Meanwhile, the arrival of some colder weather helped to boost fashion sales, particularly for outdoor wear. “Retailers continue to invest in lowering prices and streamlining their operations, part of their commitment to delivering an affordable Christmas for their customers. But this is put at risk by the £470m-per-year rise in business rates facing retailers next year. The Chancellor must freeze rates in the upcoming Autumn Statement, to prevent extra cost pressure, pushing up prices for struggling consumers.”