March was ‘disappointing end to first quarter’ according to BRC-KPMG sales monitor

UK retail sales decreased in March 2017 and currently stand at their lowest three-month average in the last five years, according to the British Retail Consortium and KPMG Retail Sales Monitor for March.

In March, UK retail sales decreased by 1.0% on a like-for-like basis from March 2016, when they had decreased 0.7% from the preceding year. On a total basis, sales fell 0.2% in March, against flat growth in March 2016.

Over the three months to March, online sales of Non-Food products grew 7.4%, while in-store sales declined 3.0% on a total basis and 3.4% on a like-for-like basis.

British Retail Consortium chief executive Helen Dickinson OBE commented: “First impressions of March’s sales figures are underwhelming, with the first decline since August last year. That said, the distortion which results from the timing of Easter always makes Spring a tricky period to assess and the later timing of the holiday this year certainly detracted from last month’s performance.

“The pressure on prices continues to build, albeit slowly, and will inevitably put a tighter squeeze on disposable income and so to ensure consumers continue to enjoy great quality, choice and value on goods, securing tariff free-trade must be the priority as the Brexit negotiations begin in earnest.”

KPMG UK head of retail Paul Martin added: “March proved a disappointing end to the first quarter for retailers, with like-for-like sales in the month down 1% on last year. Easter being later in the year is likely to have contributed to the bleaker picture, alongside the other obstacles facing the sector – especially increased input costs.

“Retailers will be hoping Easter boosts retail sales in April, whether it’s shoppers making the most of the holiday or those choosing to spruce up their homes. The new tax year marks further pressure on margins in the form of the apprenticeship levy and business rate changes, therefore tighter cost management and a focus on efficiency is more important than ever.”

Salmon global head of consultancy and innovation Hugh Fletcher was one of those to comment on the figures.

“The latest BRC–KPMG statistics highlight the increased challenge that high-street retailers face, yet online presented pleasant reading for vendors as online sales grew by 7.4% from the start of the year to March,” he said. “Vendors must now look to combat declining high-street sales, embrace retailing events and turn to a strategy that enables online services to thrive.

“With the emergence of events such as Black Friday week, and the more traditional peak trading times of Easter and Christmas, there is no doubt that retailers can prosper in the hugely competitive sector. All in all, the monthly stats are unsurprising – vendors have to realise that they cannot remain stagnant and expect to catch-up with the likes of natural e-tailers like Amazon etc. In a fast-paced industry, which is constantly evolving, technology-driven ideas will present shops with the opportunity to flourish and secure a larger share of shoppers who are increasingly craving an immediate, reliable and flexible shopping experience.

“A concerted shift towards a strong digital strategy will be the first step in achieving retail supremacy. Retailers cannot afford to shy away from online platforms and must embrace a multichannel strategy that provides the customer with the best possible service. Only then will they begin to reap the rewards that are duly deserved.”

Fujitsu UK and Ireland retail and hospitality managing director Rupal Karia added: “With March marking the beginning of a new season, it is disappointing that sales have failed to grow for the fourth month in a row. During more challenging times, it is even more crucial for retailers to find ways to make their experience enjoyable so as to entice and encourage customers into store, but also engage them once they are in there. This is where technology will have a part to play, so as to help retailers find ways to differentiate their experiences from their competitors. Retailers need to think of innovative ways to provide that heightened experience that consumers now demand thanks to the way online has altered their expectations of service which allows them to experience products in an interesting and fresh way.

“Nowadays, a large proportion of consumers use a variety of channels before purchase to research and make decisions regarding a product. Retailers need to provide customers with all of the tools to make a fully-informed decision via seamlessly integrated channels. This year it is imperative that retailers ensure all channels are seamlessly aligned, enabling customers to move freely from one to the other during their shopping experience. The retailers that ensure they are digital from the inside out and create a balanced, efficient offering that caters for all audiences will be the ones who see success.”