- UK retail sales were down 1.0% on a like-for-like basis from February 2013, when they had increased 2.7% on the preceding year. On a total basis, sales were up 0.7%, against a 4.4% increase in February 2013.
- The 3-month average total growth was 2.8%, in line with the 12-month trend, now at 2.7%.
- Home Accessories was the top performing category, followed by Furniture and Flooring which was the greatest contributor to overall growth.
- Online sales of non-food products in the UK grew 14.3% in February versus a year earlier. The online penetration rate achieved 17.5% in February.
Helen Dickinson, Director General, British Retail Consortium, said:
"Our sales figures for February show a slower pace of growth in the retail industry than in previous months, underlining that the consumer-led recovery is still developing.
"However, this slower growth might have been expected in some ways, given the record sales figures we saw in January and the strong results that we are comparing against from last year. If they were taken together, the figures from the last three months show a 2.8 per cent average growth in the retail industry, a modest increase on the 12 month average.
"Once again, furniture and home accessories were the best performing categories. This further illustrates the impact of the continued recovery in the housing market on the wider economy. On the other hand, Food sales continued to stay relatively flat.
"Overall, these figures reflect the considerable challenges still faced by consumers and retailers in the UK. It remains to be seen how the industry will fare over 2014."
David McCorquodale, Head of Retail, KPMG, said: "February saw a hiatus on the high street, with online sales soaring while in store sales stalled. There’s no doubt inclement weather exacerbated this trend, but it certainly underscores the importance of having a sophisticated online operation.
"The grocery sector remains fiercely competitive. February’s figures were impacted by the discounting campaigns launched by the value grocers, which caused a sharp slowdown of overall price inflation in the food sector.
"There were some bright spots amidst the gloom. The effects of a rapidly recovering housing market are already feeding through to the retail sector, with sales of furniture and home accessories remaining solid.
"However overall sales were pretty flat, which serves as a reminder that recovery is far from certain. Retailers need the Government to deliver measures in the forthcoming Budget which will give shoppers more pounds in their pocket, but more importantly imbue them with the confidence to spend them."
Food & Drink sector performance – Joanne Denney-Finch, Chief Executive, IGD, said: "February was another challenging month in the grocery market, with sales down slightly year-on-year, despite a modest peak over Valentine’s.
"The improving economy is definitely starting to have a positive impact on shopper sentiment. Nearly a fifth (19%) of them told us they expect to be better off in the year ahead – the highest level since January 2011.
"However, this has not yet fed through to grocery sales. ‘Savvy shopping’ habits, such as hunting around for the best deals, are very firmly established."
The BRC-KPMG Retail Sales Monitor measures changes in the actual value (including VAT) of retail sales, excluding automotive fuel. The Monitor measures the value of spending and hence does not adjust for price or VAT changes. If prices are rising, sales volumes will increase by less than sales values. In times of price deflation, sales volumes will increase by more than sales values.
Retailers report the value of their sales for the current period and the equivalent period a year ago. These figures are reported both in total and on a ‘like-for-like’ basis.
Total sales growth is the percentage change in the value of all sales compared to the same period a year earlier. The total sales measure is used to assess market level trends in retail sales. It is a guide to the growth of the whole retail industry, or how much consumers in total are spending in retail – retail spending represents approximately one-third of consumer spending. It is this measure that is often used by economists. Many retailers include distance sales as a component of total sales.
'Like-for-like' sales growth (LFL) is the percentage change in the value of comparable sales compared to the same period a year earlier. It excludes any spending in stores that opened or closed in the intervening year, thus stripping out the effect on sales of changes in floorspace. Many retailers include distance sales as a component of like-for-like comparable sales.
The like-for-like measure is often used by retailers, the city and analysts to assess the performance of individual companies, retail sectors and the industry overall, without the distorting effect of changes in floorspace.
Online (including mail order and phone) sales of non-food are transactions which take place over the internet, or via mail order or phone. Online sales growth is the percentage change in the value of online sales compared to those in the same period a year earlier. It is a guide to the growth of sales made by these non-store channels. It should be noted that online sales are still a small proportion of total UK retail sales.
Estimates based on ONS figures show about 10 per cent of total UK retail sales (food and non-food) are achieved via the internet.
The responses provided by retailers within each sales category are weighted*
(based on ONS weightings) to reflect the contribution of each category to total retail sales, thus making it representative of UK retail sales as a whole. Because the figures compare sales this month with the comparable period last year, a seasonal adjustment is not made. However, changes in the timing of Bank Holidays and Easter can create distortions, which should be considered in the interpretation of the data.
As well as receiving sales value direct from the retailers in the scheme the BRC-KPMG Retail Sales Monitor also receives food and drink sales value data from the IGD's Market Track Scheme.
In its role as sponsor of the BRC-KPMG Retail Sales Monitor, KPMG is responsible for the aggregation of the retail sales data provided by the retailers on a weekly basis. This data consists of the relevant current week’s sales data and comparative sales figures for the same period in the prior year. The aggregation has been performed by KPMG on data for periods following 2 April 2000 and equivalent prior periods. The accuracy of the data is entirely the responsibility of the retailers providing it. The sponsorship role has been performed by KPMG since 10 April 2000 and the same for the aggregation of comparative sales figures for the period from 2 April 2000 it is not responsible for the aggregation of any data included in this Monitor relating to any period prior to 2 April 2000.
* The aggregation of data for the weighted ‘online’ figures has been performed by the BRC and KPMG for periods starting 25 November 2012 and equivalent prior year periods. Prior to that date, the online figures in this monitor refer to the unweighted non-food non store indicator, as published in the BRC-KPMG Retail Sales Monitor until July 2013.
The commentary from KPMG is intended to be of general interest to readers but is not advice or a recommendation and should not be relied upon without first taking professional advice. Anyone choosing to rely on it does so at his or her own risk. To the fullest extent permitted by law, KPMG will accept no responsibility or liability in connection with its sponsorship of the Monitor and its aggregation work to any party other than the BRC.
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The March 2014 Monitor, covering the five weeks 2 March – 5 April, will be released at 00.01am Tuesday 15 April 2014.
The data is collected and collated for the BRC by KPMG.
The British Retail Consortium (BRC) is the UK's leading retail trade association. It represents the full range of retailers, large and small, multiples and independents, food and non-food, online and store based.
Sponsored and Administered by
KPMG LLP, a UK limited liability partnership, is a subsidiary of KPMG Europe LLP and operates from 22 offices across the UK with over 10,000 partners and staff. The UK firm recorded a turnover of £1.8 billion in the year ended September 2012. KPMG is a global network of professional firms providing Audit, Tax, and Advisory services. We operate in more than 156 countries and have more than 152,000 professionals working in member firms around the world. The independent member firms of the KPMG network are affiliated with KPMG International Cooperative ("KPMG International"), a Swiss entity.
KPMG International provides no client services.
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