Retail sales see second worst decline in 25 years
Retail sales decreased by 5.9 per cent in May in the second worst decline recorded since records began 25 years ago. Total in-store sales of nonfood items declined 50.3 per cent over the three months to May, according to the Retail Sales Monitor from KPMG – and by 21 per cent in shops that have been open for more than a year. This was the worst performance since records began in January 1995.
However, the overall retail sales figure was an improvement over April, which was the lowest level on record.
Food sales enjoyed a boost as a combination of sunny weather and lockdown restrictions requiring people to meet only outside saw a rise in people enjoying barbecues.
The slight relaxation in restrictions also gave a boost to beauty and clothing sales as people who had previously seen only members of their own households smartened up for their first social gatherings in weeks.
Non-food sales across both online and in-store, however, decreased by just 2.1 per cent on a like-for-like basis and 21.8 per cent in total below the 12-month total average decline of 6.4 per cent.
Helen Dickinson, chief executive of the British Retail Consortium,
said: “Sales in May demonstrated yet another month of struggle for retailers across the country, despite an improvement on the previous month. Nonetheless, as the sun came out and restaurants lay dormant, food sales rose with consumers taking to their local parks for beers, BBQS and picnics.
“Clothing and beauty sales improved slightly on April, as people left their homes to meet outside with friends and family. Continuing the lockdown trend, office supplies, fitness equipment and bicycles all performed well, thanks to strong online sales and DIY was boosted by the opening of garden centres. However, for those shops whose doors remain shuttered it was once again a tough month and even those who stayed open suffered reduced footfall and huge costs implementing social distancing measures.”
She added: “There are concerns that if Government support is withdrawn too quickly, shops and businesses will not survive. Until the situation improves, retailers urgently need support on rents and negotiations with their landlords as high fees could force some physical retailers to shut for good.”
Sales of computing products have thrived as people are working and studying from home during lockdown, the report found, while sales of toys also held up well.
Paul Martin, UK head of retail at KPMG, said: “May presented yet another testing month for retailers, with total sales down by 5.9 per cent.
“The decline is less drastic when compared to April’s fall of 19.1 per cent, however we are comparing performance to the record low of May 2019.
He added: “As restrictions ease, retailers have much to consider during the pandemic’s recovery-phase.
“Stores may soon have the greenlight to re-open but it will be a gradual affair with safety front of mind, and some doors may not reopen at all. Covid-19 has acted as an accelerant in the shift towards having less of a physical presence.”