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Bargain hunters helped UK retail sales to bounce back in July, according to a well-regarded high street monitor, which appears to contradict other surveys suggesting consumer confidence plunged sharply following Britain’s vote to leave the EU at the end of June.
Retail sales rose by 1.1 per cent in July versus the same month a year earlier, a recovery from the 0.5 per cent like-for-like decline recorded by the survey in June, when shoppers were put off by the rainy, drab weather in many parts of Britain.
Total sales, which take into account sales from recently-opened stores, rose 1.9 per cent year-on-year last month, the best performance since January and an improvement on June’s growth of just 0.2 per cent. The British Retail Consortium said last month’s figures were helped by bargain-hunters hitting the summer sales.
Helen Dickinson, chief Executive of the British Retail Consortium, said:
This month’s solid sales figures may come as a shock to some given the slew of early indicators suggesting that consumer activity was slowing in the wake of the referendum result. However, little has materially changed for most UK households in the wake of June 23, so it is not surprising to us that sales are simply responding to their normal underlying drivers. A heavy month of promotions proved very successful in appealing to bargain-hungry shoppers, boosting sales growth to 1.9 per cent, ahead of the 12- month average of 1.2 per cent.
However she questioned how sales would fare over the coming months when there are no longer sizeable discounts to tempt shoppers to part with their cash. Ms Dickinson added:
The big question for retailers is whether that success can be carried forward into full price sales. Whilst retailers continue to monitor the situation in the wake of Brexit, responding to rapid and complex change in consumer behaviour in the midst of a highly competitive market remains the substantive challenge. The industry is in the process of productivity-enhancing transformation, but Government needs to play its part to ensure that change is not suffocated by increasing costs.
Other surveys have suggested a plunge in consumer confidence since the EU membership referendum. A consumer confidence index produced by GfK recorded one of the biggest falls in its history in the aftermath of the Brexit vote.