Retail sales underperform in February

UK total retail sales rose by 1.1% year-on-year during the four-week period ended 24 February, against a growth of 5.2% last year and below the three-month average growth of 1.4%, according to the BRC. 

The BRC has attributed the poor retail sales to February 2024 being “the wettest on record”. 

Food sales saw the biggest increase during this period, rising 6% year-on-year over the three months to February. However, this was still below the 8.3% rise reported in February 2023. It is also below the 12-month average growth of 7.9%. 

Meanwhile, non-food sales decreased 2.5% year-on-year over the three-months to February, against a growth of 3.2% in the same month in 2023. This is steeper than the 12-month average decline of 0.9%. 

In-store non-food sales over the same period to February this year also decreased by 2.3% year-on-year, against a growth of 8.1% last year. This is below the 12-month average growth of 0.3%. 

Online non-food sales saw a bigger drop, decreasing by 4.1% year-on-year this February against a decline of 3.1% last year. This was steeper than the three-month and 12-month declines of 2.9%. 

The online penetration rate – the proportion of non-food items bought online – also decreased to 35.7% last month from 36.1% in February 2023. 

While sales figures for January and February show inflation running at higher than normal levels, these positive sales figures mask a likely drop in volumes. This means as inflation falls in the coming months, retail sales figures will also naturally fall at the same time. 

Helen Dickinson OBE, chief executive of the BRC, said: “Consumer demand was dampened by the wettest February on record, translating into a poor month of retail sales growth. Not even Valentine’s Day lifted customers out of the gloom, and gifting products that typically sell well, like jewellery and watches, failed to deliver. 

“With consumer confidence and demand remaining weak, the government must find ways to stimulate the economy. Retailers have some government induced cost hurdles to jump in the coming months including a £400m business rates rise based on last September’s 6.7% inflation rate. By using Wednesday’s Budget to reduce this, the Chancellor will lend a helping hand to much needed investment in businesses and local communities up and down the country.”