Retail sales volumes fell in the crucial Christmas period, according to the latest monthly retail sales monitor from the British Retail Consortium (BRC) and KPMG.
In the five weeks from 27 November to 31 December 2022 UK retail spending increased by 6.9%, compared with an increase of 2.1% in December 2021. However, this is well short of inflation, which stood at 10.7% in the 12 months to November 2022.
“Whilst the numbers for sales growth in December look healthy, with sales values up by nearly 7% on last year, this is largely due to goods costing more and masks the fact that the volume of goods that people are buying is significantly down on this time last year,” explained Paul Martin, UK head of retail at KPMG.
“Consumers shunned big ticket technology purchases in December, opting for energy efficient household appliances and Christmas mainstays of clothes and beauty items. Food sales were also strong, growing nearly 8% year on year as families gathered at home to make the most of an unrestricted Christmas.”
Sales in December were above both the three-month average growth of 4.4% and 12-month average growth of 3.1%.
Helen Dickinson, chief executive of the BRC, said that the uptick in spending over Christmas gave many retailers “cause for cheer” after a challenging year in which inflation soared and consumer confidence plummeted.
“Many consumers braved the cold snap and the strikes to ensure friends and families got the gifts they wanted, with energy-saving products, warm clothing and boots all selling well,” Dickinson added. “Nonetheless, despite the stronger sales, growth remained below inflation, making December the ninth consecutive month of falling volumes.”
