High street sales falling at rate ‘not seen since depths of pandemic’

Shop sales are falling at a rate “not seen since the depths of the pandemic” as rising costs mean households put the squeeze on spending, official figures show.

Total sales decreased by 1 per cent in June, compared to an increase of 10.4 per cent in June last year, according to the BRC-KPMG monitor. Like-for-like sales decreased 1.3 per cent compared to June 2021.

Over the three months to June, total food sales increased 2.2 per cent while non-food decreased by 3.3 per cent as households prioritise essentials.

Helen Dickinson, chief executive of the British Retail Consortium, said the figures show the impact of soaring prices on budgets.

“Sales volumes are falling to a rate not seen since the depths of the pandemic, as inflation continues to bite, and households cut back spending,” she said.

“Discretionary purchases were hit hard, especially white goods and homeware, while consumers also traded down to cheaper brands in food and non-food alike.

“While the Jubilee weekend gave food sales a temporary boost, and fashion sales benefited from the summer holiday and wedding season, this was not enough to counter the substantial slowdown in consumer spending.”

She added: “Retailers are caught between significant rising costs in their supply chains and protecting their customers from price rises. The government needs to get creative and find ways to help relieve some of this cost pressure – the upcoming consultation on transitional relief is a golden opportunity to ensure that retailers aren’t overpaying on their business rates bills.

“Government action on transitional relief would make a meaningful difference to retailers’ costs and ease pressure on prices for customers.”

Paul Martin, UK head of retail at KPMG, said  the figures came against a backdrop of unprecedented price rises on the high street.

“Online shopping continued to move in reverse with total sales down 9 per cent as non-food purchases related to the home, such as furniture, home appliances and computing, suffered the biggest falls in online spending,” he said.

“The jubilee weekend, which saw street parties across the UK, provided some relief for food and drink retailers as sales grew by nearly 1.5 per cent year on year, despite the rising cost across most items.”