Deloitte's Ian Geddes comments on today’s ONS retail sales figures
18 August 2016
Commenting on today’s ONS retail sales figures, Ian Geddes, UK head of retail at Deloitte, said:
“Retail sales volumes and values have increased strongly, possibly as a result of July’s weather being a big improvement on June’s damp start to the summer. The sunshine encouraged UK consumers to venture out to the high streets, and those that did were also rewarded with deep discounts, particularly in clothing, as retailers reacted quickly to shift stock. This strategy resulted in high sales volumes, which have increased by 1.4% from June, but likely low margins for clothing retailers.
“It is also worth noting the strong year-on-year growth in online sales values: up 16.7% since July 2015. The online market now accounts for 14.2% of all retail sales, 1.6 percentage points more than 12 months ago. Not only does this indicate a step up in online spending, but retailers also appear to be on the right path when it comes to engaging with the online consumer.
“As we found in our latest Consumer Tracker survey, conducted immediately after the EU Referendum, consumer confidence has remained resilient in the face of recent political and economic uncertainty. Spending, too, has also seen growth, with consumers indicating that they will spend money on leisure activities and big ticket items in the coming months. A key reason for this is down to the healthy state of consumer-focused fundamentals: low inflation, low interest rates and falling unemployment have combined to increase household disposable income. British success at Wimbledon also served up a feel-good factor for consumers, and it is likely that the Rio gold rush will also give a timely boost to consumer confidence, which will be seen in August’s sales figures.
“Retailers will be buoyed by the news of steady confidence and increased spending, and the industry as a whole should feel optimistic about the second half of the year, which will be seen as a period of calm before the Brexit process begins. Between now and Christmas, consumers’ spending habits are unlikely to change dramatically, and retailers have an opportunity to make hay while the sun shines.”
Notes to editors
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The information contained in this press release is correct at the time of going to press.
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