Retail sales Growth slowed by ‘sinking’ confidence

RETAIL sales growth slowed significantly last month as consumer confidence “continued to sink”, according to new research.

The latest BRC-KPMG retail sales monitor revealed that total sales increased by 3.1 per cent in March, slipping back from a 6.7 per cent rise in February.

Experts added that the growth in total sales in March was buoyed by price rises across the sector.

It came as separate research from Barclaycard showed that rising fuel prices and household bills were starting to affect customer spending patterns.

The new data comes as the cost of living crisis and rising household inflation provides a new challenge for the retail sector after two years blighted by the pandemic.

The BRC-KPMG data showed that like-for-like retail sales were down 0.4 per cent against the same month last year.

Helen Dickinson, chief executive of the British Retail Consortium, said: “As consumer confidence continued to sink, March saw sales slow, and while spend remained above last year this likely reflects higher prices.

“The rising cost of living and the ongoing war in Ukraine has shaken consumer confidence, with expectations of people’s personal finances over the next 12 months reaching depths not seen since the 2008 financial crisis.

“Furthermore, households are yet to feel the full impact of the recent rise in energy prices and national insurance changes.

“Ultimately, consumers face an enormous challenge this year, and this is likely to be reflected in retail spend in the future.”

The figures also showed that online non-food sales dropped by 29 per cent over the three months to March as the pandemic-fuelled digital boom continued to recoil.

However, Don Williams, retail partner at KPMG, said that online “penetration rates remain high” as they were compared with a period of shop closures a year earlier.

Meanwhile, total food sales decreased by 2.6% over the three months to March.