UK retailers slash prices as sales volumes drop 

*Price-conscious consumers are shopping more carefully with awareness of where bargains can be found and value for their money – which is biting hard into retail margins and profitability, says KPMG chief 

Isola Moses | ConsumerConnect

London high street

Retailers suffered a tough July this year, as wet weather and interest rates hikes saw sales growth fall behind the rate of inflation.

The situation has forced high-street sellers to step up the number of promotions they offer, according to research from the British Retail Consortium (BRC) found.

It was learnt though jumping by 1.5 percent year-on-year, retail sales were weaker than the 3.3% average bump experienced in the three months to July and the 12-month average of 3.9%.

Inflation stood at 7.9% in July, highlighting a drop in volumes, however, on a like-for-like basis, sales increased by 1.8% last month, compared with a jump of 1.6% in the year before.

Commenting on the situation, Paul Martin, UK Head of Retail at KPMG, said an increasing number of retailers were being forced to introduce price cuts and other promotions to get customers through the door and “battle to keep market share”.

“Price-conscious consumers are shopping more carefully, more aware of where bargains can be found and what they are getting for their money – which is biting hard into retail margins and profitability,” he said.

In the same vein, food sales fared slightly better, lifting by 8.4% and by 8.7% on a like-for-like basis, although food inflation has been slightly higher in 2023, coming in at 13.4% July this year, BRC stated.

Speaking on the development, Sarah Bradbury, Chief Executive Officer (CEO) at the Institute of Grocery Distribution, said: “Food and drink sales continued to grow in July, although the rate of growth was the lowest since January.

“Sales growth was driven by inflation as volumes remained in negative territory, in part due to the unseasonably wet weather, especially compared to last July’s heatwave.”

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retailers slash prices as sales volumes drop

 

*Price-conscious consumers are shopping more carefully with awareness of where bargains can be found and value for their money – which is biting hard into retail margins and profitability, says KPMG chief 

Isola Moses | ConsumerConnect

London high street

Retailers suffered a tough July this year, as wet weather and interest rates hikes saw sales growth fall behind the rate of inflation.

The situation has forced high-street sellers to step up the number of promotions they offer, according to research from the British Retail Consortium (BRC) found.

It was learnt though jumping by 1.5 percent year-on-year, retail sales were weaker than the 3.3% average bump experienced in the three months to July and the 12-month average of 3.9%.

Inflation stood at 7.9% in July, highlighting a drop in volumes, however, on a like-for-like basis, sales increased by 1.8% last month, compared with a jump of 1.6% in the year before.

Commenting on the situation, Paul Martin, UK Head of Retail at KPMG, said an increasing number of retailers were being forced to introduce price cuts and other promotions to get customers through the door and “battle to keep market share”.

“Price-conscious consumers are shopping more carefully, more aware of where bargains can be found and what they are getting for their money – which is biting hard into retail margins and profitability,” he said.

In the same vein, food sales fared slightly better, lifting by 8.4% and by 8.7% on a like-for-like basis, although food inflation has been slightly higher in 2023, coming in at 13.4% July this year, BRC stated.

Speaking on the development, Sarah Bradbury, Chief Executive Officer (CEO) at the Institute of Grocery Distribution, said: “Food and drink sales continued to grow in July, although the rate of growth was the lowest since January.

“Sales growth was driven by inflation as volumes remained in negative territory, in part due to the unseasonably wet weather, especially compared to last July’s heatwave.”

Kindly Share This Story