The BRC KPMG Retail Sales Monitor for May shows that UK retail sales values were 2.1 per cent lower on a like-for-like basis from the same month last year, when sales rose 0.8 per cent.
On a total basis, sales decreased 0.3 per cent against a 3 per cent increase in May 2010.
Stephen Robertson, director general of the BRC, comments, ‘After two previous months distorted by the later Easter and extra bank holiday, this is a more realistic reflection of how tough conditions on the high street really are.’
The BRC attributed slowing growth in food sales and non-food sales to consumers’ uncertainty about jobs and incomes, hitting big ticket purchases the hardest. Sales of clothing, footwear and homewares were also impacted.
Non-food non-store, which includes internet, mail order and phone, sales growth also slowed in May, but the BRC suggests that this was due to a very strong comparison in the same month last year. Sales were 10.4 per cent higher than a year earlier.
‘The first half of May was better than the second, when the weather turned unseasonably wet and cold in many parts of the country, but customers’ fundamental reluctance to spend is now clear to see,’ says Robertson.
Head of retail at accountancy firm KPMG, Helen Dickinson, adds that most non-food sectors experienced negative like-for-like sales.
‘This, combined with falling margins driven by a greater focus on price, lower average transaction values and increasing manufacturing costs is leaving many retailers coping with a “double whammy” impact on cash flows.’
The BRC-KPMG Retail Sales Monitor measures changes in the actual value of retail sales, including VAT, but excluding the cost of fuel.