- Brexit and political uncertainty said to be influencing factors
Subscribe to Speciality Food magazine today for just £19.99/year.subscribe now
New figures have revealed that 2019 was the first year to show an overall decline in retail sales, with Brexit one of the key influences in the dip in consumer confidence and disappointing Christmas sales.
Stats from the BRC–KPMG Retail Sales Monitor covering 24th November – 28th December 2019 show that total sales for 2019 decreased by 0.1%, compared with 1.2% growth in 2018.
Helen Dickinson, chief executive of the BRC, said, “2019 was the worst year on record and the first year to show an overall decline in retail sales. This was also reflected in the CVAs, shop closures and job losses that the industry suffered in 2019. Twice the UK faced the prospect of a no-deal Brexit, as well as political instability that concluded in a December General Election - further weakening demand for the festive period. The industry continues to transform in response to the changing technologies and shopping habits.”
However it’s reported that UK retail sales increased by 1.7% on a like-for-like basis from December 2018, when they had decreased 0.7% from the preceding year. Taking November and December together to iron out the Black Friday distortions, like-for-Like sales declined 1.2% compared with the same period in 2018.
Over the three months to December, food sales were a flat 0.0% on a like-for-like basis and increased 0.7% on a total basis. This is below the 12-month total average growth of 1.4%.
Susan Barratt, CEO at IGD said the following about the food and drink sector performance: “December’s food and grocery sales ended 2019 on a downbeat note. Despite the influence of some inflation across the market, shopper spending was not as expected for such a key sales period. As a result, while the value of spending wasn’t down, growth was negligible and volumes declined - a rarity for Christmas in recent times.
“Despite their financial confidence remaining subdued, shoppers appear to be a little bit more optimistic for 2020. Fewer expect food prices to be more expensive, with 75% of shoppers taking this view compared with 78% in November. This is also the first time since June’18 that just as many shoppers predict they will focus more on quality as saving money in the year ahead when food and grocery shopping (18%). With healthy options one of the top ways shoppers define products as higher quality, retailers and suppliers have an opportunity to engage with shoppers looking to improve their diets this month. As health remains the biggest driver for following a vegan or vegetarian diet we anticipate the plant-based trend to continue to gain traction.”