Retailers benefited from a rise in sales in January as inflation continued to push up food sales.
Retail sales rose 0.6 per cent on a like-for-like basis last month, according to data released today by the British Retail Consortium (BRC) and KPMG.
The sales landscape remained divided, with inflation pushing up sales growth in food, while sales fell on non-food items as consumers cut their discretionary spending.
Over the three months to January, store sales of non-food items slumped 3.6 per cent on a like-for-like basis.
Meanwhile, like-for-like food sales grew by 2.9 per cent.
Helen Dickinson, chief executive of the BRC, said: “The persisting tough trading environment played out at the start of the year with a mixed set of trading updates and subsequent announcements.
“Sales as well as profits are seemingly harder to come by. Against this challenging back-drop, 2018 didn’t have a bad start during what is traditionally a lean month, with sales creeping up in-line with the year’s average.”
Inflation is expected to ease this year, but Dickinson said there could be a “bumpy” road ahead for consumers, depending on the outcome of Brexit negotiations.
Paul Martin, head of retail at KPMG, said that January was a “tough gig” for retailers, and that the sales growth recorded was a success for the industry. However, he said there was little growth in sectors other than food.
“Bigger ticket items such as furniture traditionally rely on strong post-Christmas trade, but this year seem to have struggled to woo consumers with the lure of a sale sign in the window,” he said.
There have been significant signs of distress in the retail industry, for both non-food and food retailers.
High street fashion chain East fell into administration at the end of January, putting 314 jobs at risk. This followed on from a difficult 2017, when Deloitte recorded a 28 per cent jump in retail administrations, the first rise in retail administrations for five years.