Retail sales development slowed considerably final month as consumer confidence “continued to sink” amid the cost of living crisis, new analysis has revealed.
It comes as an increase in family payments, meals and gas has began to have an effect on buyer spending patterns, separate analysis from Barclaycard discovered. Experts added that the expansion in whole sales in March was buoyed by value rises throughout the retail sector.
The newest BRC-KPMG retail sales monitor revealed that whole sales elevated by 3.1 per cent in March, slipping again from a 6.7 per cent rise in February.
The new knowledge highlights the brand new problem for the retail sector simply two years blighted by the pandemic.
The BRC-KPMG knowledge confirmed that like-for-like retail sales had been down 0.4 per cent in opposition to the identical month final year.
Helen Dickinson, chief government of the British Retail Consortium (BRC), stated: “As consumer confidence continued to sink, March saw sales slow, and while spend remained above last year this likely reflects higher prices.
“The rising cost of living and the ongoing war in Ukraine has shaken consumer confidence, with expectations of people’s personal finances over the next 12 months reaching depths not seen since the 2008 financial crisis.
“Furthermore, households are yet to feel the full impact of the recent rise in energy prices and national insurance changes.
“Ultimately, consumers face an enormous challenge this year, and this is likely to be reflected in retail spend in the future.”
The figures additionally confirmed that on-line non-food sales dropped by 29 per cent over the three months to March as the pandemic-fuelled digital growth continued to recoil.
However, Don Williams, retail accomplice at KPMG, stated that on-line “penetration rates remain high” as they had been in contrast with a interval of store closures a year earlier.
Meanwhile, whole meals sales decreased by 2.6 per cent over the three months to March.
Susan Barratt, chief government officer of the Institute of Grocery Distribution (IGD), added: “Food and drink sales struggled in March, partly due to facing strong comparatives to 2021.
“Not only were sales elevated last year due to lockdown, but Easter was also earlier and we’re yet to see holiday spending ramp up this year.
“It is no surprise that shopper confidence continues to fall and is now lower than the previous low of December 2013 when the horsemeat scandal impacted the food industry.”
Elsewhere, Barclaycard’s newest bank card knowledge confirmed that consumer spending was nonetheless considerably forward of pre-pandemic ranges as folks spent extra on hospitality, however nonetheless highlighted some stress on consumer confidence.
Card spending in March elevated by 17.7 per cent in opposition to ranges from the identical month in 2019, as folks spent extra on important gadgets.
The enhance was notably pushed by the next spend on gas, which soared by 26.1 per cent after costs rocketed.
Jose Carvalho, head of consumer merchandise at Barclaycard, stated: “Many sectors saw strong growth in March compared to the same period in 2019, as sunnier weather encouraged Brits to socialise at pubs and bars, book staycations and update their wardrobes for spring and summer.
“However, rising fuel prices and household bills are clearly starting to influence consumer behaviour, with many Brits changing their travel and shopping habits to save money.
“While this may dampen growth in the months ahead, we shouldn’t overlook the expected heatwave later in April, and the fast-approaching Easter holidays, both of which are likely to boost non-essential spending.”