A “rocky road ahead” for consumers

It appears that February’s stormy weather and the recent rise in the cost of living has deterred many consumers from spending.

Last month, UK retail sales fell by 0.3 per cent, the Office for National Statistics reported, and online sales volumes fell by 4.8 per cent – following strong growth in December and January.

This comes after we saw an overall 1.9 per cent rise in sales in January.

Heather Bovill, ONS Deputy Director for Surveys and Economic Indicators, commented: “After a buoyant January, retail sales fell back a little last month and there was a notable decline for companies that predominantly trade online, following a strong performance over the festive and New Year period.

While clothing and department stores appeared to do well in February, household goods and many other stores reported a dip in sales.

However, Ms Bovill pointed out that online sales overall continue to “boom”, thanks largely to the pandemic and changing shopping behaviours. Online sales volumes in February were still 33.2 per cent above the pre-COVID February 2020 levels.

Helen Dickinson, Chief Executive of the British Retail Consortium, said that as competition for limited consumer spend increases, retailers must continue to invest in their physical and digital offerings…

“Consumers face a rocky road ahead, with rises in the energy price cap and NI contributions both coming next week. Meanwhile, confidence has been knocked by the continued rise in inflation, as well as the uncertainty created by the situation in Ukraine.

“While the Chancellor’s Spring Statement offered some relief for consumers, rising inflation and next week’s rise in the energy price cap mean that real discretionary incomes are likely to fall in the coming months, as the cost of living soars.”