Last month ‘worst July on record’ for year-on-year growth in total retail sales

Last month was the worst July on record for year-on-year growth in total retail sales, according to an index.

As temperatures soared and people basked in the sunshine, on a total basis, sales edged up by just 0.3% year-on-year in July, compared with an increase of 1.6% in July 2018, according to the BRC (British Retail Consortium)-KPMG retail sales monitor.

It was the lowest year-on-year growth figure recorded for the month of July since the records started in 1995 – and also follows the worst June on the index’s records.

Total retail sales had declined year-on-year in both May and June.

Paul Martin, UK head of retail at KPMG said: “While any growth is welcome after two months of decline, it’s clear that most players need more than sunshine to get back on their feet.”

On a like-for-like basis, UK retail sales edged up by 0.1% from July 2018.

This was an improvement compared with recent averages, the index said.

Mr Martin said shoppers “are notably disengaged overall”.

Helen Dickinson, chief executive of the BRC said: “While retailers will welcome the return to growth, it has nonetheless been a punishing few months for the industry.

“The combination of slow real wage growth and Brexit uncertainty has left consumer spending languishing with the 12-month average total sales falling to a new low of just 0.5%.

“Whereas last year’s glorious sunshine and World Cup Finals led to strong consumer demand over the summer, this year has been weak in comparison, with both June and July showing the lowest sales on record for their respective months.”

She said it is not just high streets that are suffering, with online sales of non-food products showing weaker growth in July than a year ago.

Ms Dickinson continued: “The challenging retail environment is taking its toll on many high street brands who must contend with rising import costs, a multitude of public policy costs, and ever higher business rates.

“A coherent strategy for retail is needed.

“The Government should freeze future business rates rises and fix the appeals system before embarking on a wholesale reform of this broken tax system.”