UK retail sales fall as shoppers cut back on homeware amid rising prices

Retail sales fell last month as squeezed shoppers cut back on purchases of homeware, furniture and appliances amid spiralling living costs.

Sales fell for the second month in a row during May with the high street stores seeing trade remaining well below pre-pandemic levels, despite some signs of a rebound this year.

Soaring inflation has pummelled consumer confidence as the spending power of people’s wages falls.

Shoppers bought fewer big-ticket items while increasing their spend on footwear and clothing in anticipiation of more events and holidays this summer after the lifting of Covid restrictions.

Total retail sales decreased by 1.1 per cent in May, according to the latest monthly BRC-KPMG retail sales monitor. Like-for-like sales were down 1.5 per cent compared with the same month a year earlier.

Sales figures are not adjusted for rising prices, meaning the actual volume of goods sold is likely to be down much more sharply.

Helen Dickinson, chief executive of the British Retail Consortium (BRC), said: “Sales continued to see declines as the cost-of-living crunch squeezed consumer demand.

“Higher value items, such as furniture and electronics, took the biggest hit as shoppers reconsidered major purchases during this difficult time.

“Nonetheless, fashion and beauty did well as people prepared for holidays abroad and the summer's social calendar; with red, white and blue outfits adorning shopping carts ahead of the jubilee weekend.”

Non-food retailers, saw like-for-like sales fall 1 per cent over the three months to May, with total sales rising 2 per cent as prices were pushed up by inflation. Food sales dipped by 1 per cent on like-for-like basis over the three-month period.

The figures are the latest warning signal on the UK economy after Bank of England data last week showed a record rise in credit card debt. A closely-watched survey by GfK last month indicated that consumer confidence had falled to the lowest level since records began in 1974.

Paul Martin, UK head of retail at KPMG, added: “For the second month in a row UK retail sales declined, highlighting that consumers are becoming more sensitive to the cost of living.

"The rising cost of living is going to remain the main story for retailers for the immediate future, with consumer confidence a key factor to watch out for.

“Retailers will be hoping that a post-jubilee and summer feel-good factor begins to improve confidence amongst some shoppers – as presently overall confidence levels are lower than sales may suggest.”