- UK retail sales values were up 1.9% on a like-for-like basis from January 2012, when they were down 0.3% on the preceding year. On a total basis, sales were up 3.0%, against a 2.1% rise in January 2012.
- This is the highest total sales growth since September 2012 and like-for-like sales growth for 13 months.
- Online sales were up 10.1% over January 2012, when they had risen by 11.3%.
Helen Dickinson, Director General, British Retail Consortium, said: "After a fairly subdued December, these results are sure to lift spirits for many. Retailers didn’t have high hopes for strong sales at Christmas, but this meant that they prepared well and headed into the New Year with less stock to clear than last year. People were tempted out by offers and promotions but also treated themselves to full-price and premium products early in January, particularly must-have technology items. These factors, coupled with recovering consumer confidence, have added up to a more successful January than we saw last year.
"Sales suffered during the recent cold snap, but it was thankfully short-lived and didn’t cancel out the positive showing across the month as a whole. Its force was felt in some areas more than others – Footwear performed well thanks to a ‘boots boost’ but it wasn’t such a good month for clothing. Online sales growth returned to closer to the longer-run average after a bumper December.
"All in all, these figures give a sense that the mood is lifting a little for customers and retailers. Let’s hope it continues."
David McCorquodale, Head of Retail, KPMG, said: "January’s sales figures will give retailers reasons to be cheerful as like-for-like sales achieved the highest increase seen since December 2011. It’s a strong start to what is anticipated to be a tough year for the sector.
"Many retailers will be pleased with their sales campaigns as 2013 roared into life producing double-digit sales increases in several categories in the first week. Sadly a blanket of snow mid-month slowed the charge as Payday approached.
"Targeted promotional campaigns from the grocers fighting for market share helped drive strong January food sales, which triggered the first acceleration in food’s three month growth rate since last July.
"While technology advances may have hastened the demise of HMV, Blockbuster and Jessops, many retailers will look back at the last two months with pride after implementing successful seasonal campaigns where they have served the customer well. Sales are only one side of the equation and time will soon reveal the true cost of the promotions and margin squeezes used to drive these sales. However, it is encouraging to see such positive results in what is traditionally a challenging month."
Food & Drink sector performance – Joanne Denney-Finch, Chief Executive, IGD, said: "After a flat end to 2012, this year’s food and grocery sales started encouragingly.
"The first trading week in January was particularly strong although our period included New Year’s Eve, unlike last year, making the comparison difficult. However, the resilience of the market in the second half of the month, despite severe weather, gives further grounds for cautious optimism.
"Many people tighten their belts in January and, while price is obviously an important factor, our ShopperVista research shows that 53 per cent of shoppers say they are willing to pay extra for high quality ingredients."
Notes
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 this non-store channel. It should be noted that online sales are still a small proportion of total UK retail sales. Estimates based on ONS figures show about 9 per cent of total UK retail sales (food and non-food) are achieved via the non-store channel.
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 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 February 2013 Monitor, covering the four weeks 27 January – 23 February, will be released at 00.01am Tuesday 5 March 2013.
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.
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