The United Kingdom retail sales dropped 0.9 per cent this August compared to the same month last year on a like-to-like basis, a report by the British Retail Consortium (BRC) and KPMG said.
"On a total basis, sales declined 0.3 per cent, against a 0.1 per cent increase in August 2015. This is the weakest performance since September 2014, excluding Easter distortions. On a three-month basis, total UK retail sales rose 0.6 per cent, half the rate of the 12-month average of 1.2 per cent," the report states. The BRC survey measures an annual change in sales.
According to BRC– KPMG Retail Sales Monitor September 2016, non-food sales rose to just 0.4 per cent in contrast to its 12-month average of 1.9 per cent. The food sales performed considerably better with an improved statistics of 0.9 per cent growth, its greatest increase since December 2013. Watches and jewellery were the best-performing categories.
"Consumers were enticed towards leisure and outdoor activities rather than shopping, although food did post its strongest performance in more than two years; fuelled by demand for picnic, barbeque supplies and celebratory drinks," Helen Dickinson, chief executive, British Retail Consortium said.
"Care should be taken in reading too much into August's lacklustre performance. As we've seen in the last couple of months, data portending the health of the economy paint a volatile picture. The fact is that so far little has directly changed for the UK's consumers as a result of the referendum, so it's the pre-existing market dynamics that are still driving sales. The slowdown in real wage growth in the first half of 2016 and strong competition will continue to weigh on trend growth in total sales; whilst holiday timings, promotional and seasonal activity will contribute to fluctuations month on month," she said.
Olympics and outdoor activities diverted shoppers' attention, the study concluded.
"Sales of women's fashions performed particularly poorly, despite widespread promotions. The warmer weather made it almost too hot to shop and dissuaded shoppers from looking at the newly arrived autumn products. Despite this, jewellery sales continued to benefit from international shoppers taking advantage of the weaker pound. Whilst for those at home, some of whom may have opted for a staycation given the exchange rate, the warmer weather put wine and barbeques firmly on the menu – much to the delight of food and drinks sellers," David McCorquodale, head of retail, KPMG has been quoted as saying in the report.