The late arrival of summer returned retail sales to growth – boosted by consumers buying clothing and beauty products in preparation for the holidays, figures show.
Total retail sales increased by 0.5% year on year in July, although this was relatively subdued against 2023’s 1.5% growth, according to the British Retail Consortium (BRC)-KPMG Retail Sales Monitor.
Food sales were up 2.6% year on year over the three months to July, but again well down on last year’s growth of 8.4%.
Sales of items other than food fell 1.7% year on year over the quarter, the three months to July, against a decline of 0.5% in July 2023, as consumer spending on holidays and entertainment squeezed out sales of indoor goods such as furniture and household appliances.
BRC chief executive Helen Dickinson said: “The late arrival of British sunshine led to a better month for summer clothing and health and beauty products as shoppers prepared for days out with friends and holidays away.”
Linda Ellett, UK head of consumer, retail and leisure at KPMG, said: “While summer staples, such as health, beauty, and gardening products have helped to drive retail sales growth both online and in-store in July, the upturn is likely much less than retailers were hoping for at this key time of the year.
“A busy summer of televised sport has played a beneficial role in increasing TV, mobile and tablet sales over the last two months, but there’s little evidence of other big ticket purchases taking place.
“Spending levels continue to be governed by whether households have been able to absorb the likes of mortgage and rent increases, or had to limit their spend elsewhere as a consequence. Also, while some sectors are seeing wage growth, others are cutting posts, leaving some consumers mindful that they may need to fall back on savings if they find themselves out of work.”
Separate figures from Barclays show consumer card spending fell by 0.3% year on year in July as the mixed weather across the month, combined with selective discretionary spending, continued to pose challenges for retailers.
While the arrival of warmer days and belated summer sales did result in a modest recovery for retail, 39% of consumers said July’s rainy weather led them to cut back on “summer spending”.
The average Briton reduced their outgoings by £133.40, with 18 to 34-year-olds cutting back the most at £158.40.
Pubs, bars and clubs saw an uplift of 4.9% in July, the category’s highest growth since January as football fans flocked to their local to watch the final rounds of the Euro 2024 tournament, Barclays data shows.
Karen Johnson, head of retail at Barclays, said: “Shoppers and retailers alike will be ready to see the end of the summer showers. It’s encouraging to see seasonal staples such as BBQ supplies, beauty buys and holiday planning delivering signals of steady recovery.
“Despite England losing in the nail-biting final of the Euros, UK hospitality emerged as a true winner, when the Euros delivered a boost for pubs, bars and clubs.
“With the final days of the Olympics in Paris, Taylor Swift’s return to a sold-out Wembley Stadium for her final UK Eras Tour dates, and a heatwave on the cards, we hope summer spending will finish strongly in August.”
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