Food sales growth in the UK showed signs of deceleration in September, influenced by adverse weather conditions.
- The British Retail Consortium (BRC) and KPMG reported a notable drop in food sales increase from 7.4% in September 2023 to 3.1% this year.
- The wet weather and economic caution are key factors contributing to the slowdown in sales growth.
- Despite a slower pace in food sales, UK retail showed its strongest growth in six months, bolstered by non-food sectors.
- Concerns about rising energy prices and an impending Autumn Budget pose potential challenges to consumer confidence.
In September, the UK experienced a significant slowdown in food sales growth, primarily attributed to unfavourable weather conditions. Over the past three months, food sales saw a 3.1% increase compared to the previous year. However, this is a marked decrease from the 7.4% growth recorded in the same month of 2023, and it falls below the 12-month average growth of 4.4%.
Sarah Bradbury, CEO of IGD, commented on the situation, noting, “Growth in the grocery retail market slackened with the arrival of autumn. September’s sales were still ahead year-on-year, but the pace of increase was down versus August, no doubt depressed by the wet weather as well as cautionary economic messages from the government.” Shoppers facing cautionary economic messages have contributed to a more restrained approach to spending.
Retailers have begun implementing their seasonal ranges earlier this year as they strive to capitalise on the lucrative golden quarter, despite the overall deceleration in food sales. This strategic move highlights their efforts to maximise profits during the crucial trading period that encompasses the end of the year holidays.
The broader retail environment in the UK, however, showed resilience despite the slackening of food sales. According to Helen Dickinson, the chief executive of BRC, UK retail experienced the strongest growth in six months in September, driven largely by the unexpectedly solid performance of non-food sectors. Retail sales increased by 2% year over year, surpassing the three-month average growth of 1.2%.
Looking to the future, challenges remain on the horizon. Rising energy prices and the anticipation of a difficult Autumn Budget are likely to continue to impact shopper confidence. Sarah Bradbury remarked that these factors keep cost-of-living concerns at the forefront for consumers. In line with this sentiment, Helen Dickinson suggested that decisive governmental actions, such as the introduction of a 20% Retail Rates Corrector, could bolster investment and spur economic growth across the country.
The interplay of wet weather and economic caution has slowed food sales growth, despite a robust retail sector.
