Deloitte comments on today's ONS retail sales figures
21 April 2017
Commenting on today’s ONS retail sales figures, Ian Geddes, head of retail at Deloitte, said:
“March’s retail sales show strong year-on-year growth in both value and volume terms, up by 5.1% and 1.7% respectively. The sharp contrast from March last year is in large part due to deflation which impacted sales growth in the first half of 2016. However, compared to February 2017, last month’s retail sales values and volumes were both down, and we have seen the first quarterly decline since 2013. This could be an indication that pockets are getting tighter as the effects of inflation and rising cost pressures are starting to be felt by consumers.
“Online sales also increased year-on-year by 19.5% and now account for approximately 15.5% of all retail spending. This is further evidence of consumers’ continued adoption of digital technology such as smartphones and voice-controlled devices. Retailers are having to adapt business strategies in order to contend with a rapidly changing technology environment and a revolution in how customers want to consume goods and services.
“The industry is still seeing strong spending growth after a sustained period of broadly confident consumers that are benefiting from low interest rates and record levels of employment. Consumer confidence will be an important economic measure in the coming months. This, along with the retail industry’s resilience, may well be tested in the short term, but there is some way to go before the sector reaches a tipping point.
“Looking ahead, retailers will likely be more optimistic about the start of the second quarter. Mild, sunny weather coinciding with the long Easter weekend is the perfect recipe for increased footfall. April’s retail sales figures should see month-on-month value increases after having the right conditions to support the sales of products for the home and garden along with summer clothing. Those businesses that haven’t capitalised on this sweet spot will need to reconsider their strategies so as to remain competitive when the umbrellas are needed.”
Notes to editors
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