- UK retail sales values were up 1.5% on a like-for-like basis from September 2011, when they were up 0.3% on the preceding year. On a total basis, sales were up 3.4%, against a 2.5% rise in September 2011.
- The recovery from last month was mainly driven by Clothing and Footwear, which saw its best growth since last Christmas, partly helped by the favourable weather. There were also some signs of revival in the Home and Furniture market.
- Online sales picked up from August’s record low ending the month on a strong note. However, on average, September – at 9.9% - remained weaker than this year’s trend.
Stephen Robertson, Director General, British Retail Consortium, said: "After a poor summer for sales, this is a return to growth rates we’ve come to regard as relatively acceptable in these relentlessly tough times. The improvement has come from the weather and a change in the mindset of some customers.
"This September’s colder conditions contrast sharply with the heatwave a year ago, giving clothing and footwear sales a major boost as shoppers stock up early on coats, boots and knitwear. Children’s clothes and shoes did particularly well in September, partly because many people left back-to-school buying later this year as a result of competition for their time in August.
"It’s not all good news - the on-going challenges in the housing market contributed to sales of home accessories falling at their fastest for three years - but there are signs that people are acclimatising to the new realities. Difficult has become the new norm. Customers are still cautious but less fearful than they were. The squeeze on disposable incomes has eased for some and, along with lots of discounts, left them feeling it’s time to stop postponing spending. Retailers will be hoping this modest boost strengthens as Christmas approaches.
David McCorquodale, Head of Retail, KPMG, said: "After a turbulent year on the UK high street, September’s sales figures bring much needed relief for retailers. The news that like-for-like sales rebounded to achieve the highest increase seen in 2012 may give many renewed heart as they enter the most important trading period of the year.
"September’s surge in sales was driven primarily by customers buying winter woollies as the arrival of autumn/winter fashions heralded the end of an often wet summer and ‘back-to-school’ drove increases in children’s clothing and shoes.
"With the rent paid for the last quarter before Christmas and most seasonal orders now made, the bets for the final quarter have been placed. Retailers will now be hoping that the consumer finds some confidence for 2013 to drive sales for the next three months. If that doesn’t happen there’s a real risk that the retailers will be forced to discount their seasonal margins away."
Food & Drink – Joanne Denney-Finch, Chief Executive, IGD, said: "September’s sales mirrored the changing weather. There was sun at the start, which helped produce the best food and grocery sales week of the month. But this was followed by heavy downpours and the worst September storms for 30 years, with sales tailing off as the month progressed.
"Shoppers have been on an ‘optimism rollercoaster’ this year, feeling better about the future in the summer, but becoming more cautious as the nights draw in. Food companies will be hoping for milder weather through the rest of autumn and for themed events, such as Halloween, to help boost sales."
Online* (Non-Food) - Stephen Robertson, Director General, British Retail Consortium, said: "August saw online sales growth fall to a record low as hearts and minds were captured by sporting triumphs rather than shopping.
"Sales in September were slow out of the starting blocks while households were absorbed with watching the Paralympics, but had a stronger finish, helped by autumnal weather and a slight improvement in customer confidence. While September’s growth rate is still below the average of the last year it’s double the rate in August and should accelerate as nights draw in and shoppers start to think about making headway on their Christmas lists."
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 very 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.
© Copyright British Retail Consortium and KPMG
British Retail Consortium
21 Dartmouth Street
020 7854 8900
Richard Dodd, 020 7854 8924
mobile: 07921 605544
8 salisbury Square
London EC4Y 8BB
0207 311 1000
Zoe Sheppard, 0117 906 4337
mobile: 07770 737 994
The October 2012 Monitor, covering the four weeks 30 September– 27 October, will be released at 00.01am Tuesday 6 November 2012.
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 11,000 partners and staff. The UK firm recorded a turnover of £1.7 billion in the year ended September 2011. KPMG is a global network of professional firms providing Audit, Tax, and Advisory services. We operate in 152 countries and have 145,000 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.
IGD makes a difference by providing international market intelligence, supply chain best practice and consumer insight to the food and grocery industry worldwide.
We work with consumers, companies and individuals across the chain to provide authoritative information, insight, thought leadership and leading edge best practice to help companies grow their business and develop their people.