April 2024 marked another challenging month for UK retailers as sales volumes fell sharply, according to the latest data from the Office for National Statistics (ONS).
This decline is part of a broader trend of fluctuating consumer spending that has characterized the retail sector in recent months.
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Recent retail sales trends
The ONS reported that retail sales volumes decreased by 2.3% in April, a significant drop from the modest fall of 0.2% in March, which itself was revised down from an initially reported stagnation.
This downturn was felt across multiple sectors, particularly in clothing, sports equipment, games, toys, and furniture stores, where poor weather conditions were blamed for reduced footfall.
Silvia Rindone, EY UK&I Retail Lead, highlighted the impact of the weather on consumer behaviour: “Poor weather throughout the month discouraged shoppers from venturing out, leading to a dampening of retail sales which fell 2.3% with the most significant fall seen in clothing and sports equipment categories.”
Despite this monthly decline, the ONS data showed a slight improvement in the quarter, with sales volumes up 0.7% in the three months to April compared with the previous three months.
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By GlobalDataHowever, this figure still represents a 0.8% decrease from the same period last year, indicating ongoing challenges in the retail sector.
A decline in retail sales volumes and values
April’s data paints a stark picture of the current retail landscape. Overall sales volumes and values fell sharply, continuing a downward trend that has persisted since the pandemic’s onset.
By April 2024, sales volumes had fallen by 2.7% year-on-year and were 3.8% below their pre-Covid-19 levels.
Rindone commented on the broader economic factors influencing consumer decisions: “While many households are starting to see a rise in disposable income, caution remains. The lingering economic uncertainty has led to a conservative approach to spending, with consumers saving for unforeseen challenges rather than indulging in immediate gratification, particularly on higher-priced items.”
Significant challenges across retail industries
The decline was most pronounced in non-food stores, where sales volumes dropped by 4.1%—a joint record low with December 2023.
This category includes department stores and specialised retailers, many of which have struggled with low footfall due to adverse weather and ongoing economic pressures.
The automotive fuel sector also saw a significant contraction, with the largest monthly fall since October 2021.
Food stores have not been spared either, suffering their third consecutive month of declining sales, primarily driven by supermarkets grappling with rising operational costs and cautious consumer spending.
The rise of online shopping amidst overall decline
Interestingly, while overall retail sales declined, the proportion of sales made online increased slightly.
Online spending values fell by 1.2% over the month, but as total spending saw a larger decline, the proportion of online sales edged up from 26.2% in March to 26.5% in April.
This shift underscores a growing trend towards online shopping, even as the overall expenditure shrinks. Rindone stresses the importance of differentiation for retailers in this evolving market:
“We are now seeing a growing divide between retailers who give customers good reasons to spend and those who fail to offer great customer service or lack clear focus by trying to appeal to everyone with specialisation.”
Looking ahead
The UK retail sector faces a complex set of challenges as it moves into the mid-year. While there are signs of potential recovery with the easing of disposable income constraints, retailers will need to navigate the lingering economic uncertainty and shifting consumer preferences to capitalise on any upswing in spending.
As Rindone suggests, the coming months may provide an opportunity for retailers to mitigate new financial burdens through strategic planning and enhanced customer experiences.
