Food sales, boosted by strong promotional activity over the summer, continue to perform better than non-food, but still record the second weakest growth in 11 months, showing that strong sales performance in June and July was driven by seasonal factors.
Stephen Robertson, Director General, British Retail Consortium, said:
“The stronger figures of June and July haven’t been sustained. It’s clear the deceptively good sales growth of those months was due to summer sun and price cuts – not any major revival in how customers are feeling. What spending we now have is all about value and essentials.
Clothing and retail sales are suffering as consumers hold off purchases of winter wear until necessary.
Homewares and furniture sales also fell back as consumers are still “very reluctant” to spend on big-ticket household items.
Non-store sales, which include internet, mail order and phone sales, recorded the weakest growth since May, showing they are “not immune from the impact of the recession”.
The BRC also urges caution over any sales growth in the autumn, as figures will be compared to “very weak” figures 12 months ago.
Helen Dickenson, head of retail at KPMG says: “The results for the month and the rest of the year need to be considered in the light of the performance last year, which continued to weaken as the year progressed. Negative like-for-like sales on the back of the same situation last year is leaving many retailers with some serious challenges around controlling costs and generating cash.”