Tuesday 8 September 2020 12:01 am

UK retail sector shows 'promising' signs of recovery in August

UK retailers showed “promising” signs of recovery last month as sales jumped, the latest research showed. 

Retail sales increased 4.7 per cent on a like-for-like basis compared to August last year, when they had decreased 0.8 per cent. 

Total sales were up 3.9 per cent last month, against a decline of 0.4 per cent last year, reaching the strongest growth since May 2018. 

However the British Retail Consortium (BRC) warned that “many retailers are hanging by a thread” due to high rents, the end of the furlough scheme and low city centre footfall. 

Chief executive Helen Dickinson said: “Lockdown appears to have permanently changed some consumers’ shopping habits, with online sales continuing to boom despite shops reopening in June.

“Meanwhile, city centre retailers continue to be devastated by low footfall and poor sales, as office workers stayed away for yet another month.”

She added: “Government will need to act fast or September will see more shops close and more job losses realised.”

Paul Martin, UK head of retail at KPMG, said: “The retail sector continued to show promising signs of recovery in August, with like-for-like retail sales up 4.7 per cent compared to last year. 

“Whilst welcome news, the coming months are far from problem free, with economic uncertainties – including the unwinding of the furlough scheme – likely to leave many consumers thinking carefully about their spending priorities.”

In the three months to August, total in-store sales of non-food items declined 17.8 per cent, which is better than the 12-month total average decline. 

Meanwhile food sales increased 6.3 per cent on a like-for-like basis and 5.9 per cent on a total basis. 

Online non-food sales increased by 42.4 per cent in August, against a growth of 1.6 per cent in August 2019

Non-food online penetration rate increased from 29 per cent last year to 39.3 per cent this August.