Retail sales sluggish in February

Retail sales slipped back again in February, according to a study by the British Retail Consortium (BRC), prompting the body to dismiss talk of a high street revival as “illusory”.


Sales from outlets open for a year or more fell 0.3% on the same month last year when like-for-like income fell 0.4%. The February slump follows the same percentage decline reported by BRC/KPMG in January.

When receipts from stores opened in the last year are added, sales increased 2.3% in February. However, this is still below the 3.6% rate of inflation meaning that total sales are down in real terms.

The continued decline will be a disappointment to retail chiefs after separate studies signaled conditions were improving.

The Confederation of British Industry recently found a sales rebound in February. Last week, GfK said that that its consumer confidence barometer for February held at its highest rate since June 2011.

Stephen Robertson, director general of the BRC, says that despite some evidence to the contrary, the “weak” sales found in its monthly tracker show “a convincing revival remains illusory”.

He adds: “Falling inflation has eased the squeeze on household finances and halted the slide in consumer confidence but that’s at risk from fuel price rises and Budget uncertainty. Unemployment is expected to rise further causing increased nervousness about job security, which is keeping confidence fragile. Any sense of improving optimism is not yet translating into more spending.

“Total sales growth is still below inflation, so overall customers are actually buying less than a year ago, while discounts are eating into margins.”

Food sales increased year-on-year in February, the BRC says, without offering details. Non-food sales weakened further with footwear and homewares particularly hit, it adds.

Internet, mail-order and phone sales rose 9.9%, slower than the 11.3% reported in January and the 10.4% increase in February 2011.

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