Retail sales figures in the UK recovered in July and are now back to pre-pandemic levels according to data supplied by the Office for National Statistics (ONS), thanks to the reopening of stores and pent-up consumer demand. However, the news is not so good for the clothing sector, which is still struggling to see a significant recovery to pre-lockdown levels. Despite a rise of 12 percent in sales during July, this is still below a quarter of the sales figures for February the last full month of trading before the lockdown began.
During July, the overall rise in retail sales stood at 3.6% compared to June, with online shopping and food sales at much higher levels than prior to the lockdown. Recently, Marks and Spencer announced a 3% rise in food sales in the past 13 weeks of trading, whilst online electrical retailer AO announced revenue growth in the UK of more than half in the four proceeding months to 31st July.
Online sales slowing and compulsory masks put off shoppers
With the stores gradually reopening during June, online sales softened slightly with a 7 percent fall recorded in July compared to the previous month, although they still remain 50 percent higher than the levels recorded in February. Meanwhile, grocery sales also experienced a slow down during the three months prior to 9 August, with sales from in-store shopping falling by 14.4%. It appears the compulsory wearing of face masks in shops can be attributed to the lowering of footfall in shops and supermarkets with 2 million less visits recorded in the week following the rule coming into force on 24 July.
The clothing sector has seen one of the highest falls
Stores selling clothes have been particularly affected by the pandemic, with sales hit due to more people staying home or working from home as well as the restrictions on social gatherings, sports events and holidays.
During the summer of 2019, holidays were one of the main reasons for clothes buying, with the British public raising sales by 15% for the three months proceeding 30 June 2019. These figures then fell by 3% in the three months leading to 28 June 2020, with clothes sales for special events such as weddings also being hit hard.
With the introduction of the ‘Eat out to help out’ scheme during August, it will be interesting to see if the increased footfall in the high-street will have a knock-on effect on other retail sectors. Although it is good to see retail figures rise, social distancing measures and protective measures may hit profit margins, and there is the added pressure of retailers facing the prospect of their next quarterly rent payment due at the end of September.