UK retail sales have declined for the fifth month in a row in the year to September, according to the latest Distributive Trades Survey by the Confederation of British Industry (CBI).
The report found that the decline came at a slower pace of 16% compares with last month’s decline of 49%. Retailers expect next month’s sales to decline at an even slower pace of 5%.
Supplier orders for September have also shrunk for five consecutive months, with a decline of 9% compared with a 57% decline in August. Supplier orders are expected to be mostly flat in the year to October, rising just 3%.
The report also stated that sales volumes were seen as poor for the time of year, down 11% and to a greater degree than last month, when they were down 6%, with sales expected to be mostly average for the same time of year next month.
Internet sales experienced a slight growth in the year to September but remained below the long-run average for the past seven months. Retailers expect the growth to improve in October, although it will fall short of the long-run average.
Sales declined across all sectors with the exception of furniture and carpet retail, which reported unchanged volumes in September. The lowest sales came from clothing retailers and department stores.
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CBI chief economist Rain Newton-Smith said: “Five successive months of falling volumes tells its own story about the tough conditions retailers are having to operate in. Add to this the pressures of Sterling depreciation and the need to plan for potential tariffs and supply issues in the event of a no-deal Brexit and you get a gloomy picture for the sector.
“Retailers are also grappling with ongoing challenges such as digital disruption and the cumulative burden of government policies. Reforming an outdated business rates system and a more flexible apprenticeship levy which delivers better value for money could really help to alleviate the pressure on retailers during these difficult times.”
Wholesale volumes and orders increased for the time first since June and January respectively. Both are expected to further increase next month. Motor traders also experienced volume and order growth for the first time since April This increase is expected to end with a decline in October.
UK retail sales suffer as Brexit drives uncertainty
Retail sales across the UK have suffered for the first half of 2019, due to companies stockpiling ahead of previous Brexit deadlines and a change in the timing of car plant annual shutdowns.
The CBI said that it expects the economy to grow modestly, though a no-deal Brexit would likely hit activity and financial markets significantly.
Earlier this year, June 2019 UK retail sales were reported to have been the worst on record, with a 1.3% total basis decline, according to a report by the British Retail Consortium (BRC).
The Office for National Statistics Retail sales, Great Britain: June 2019 report also reported that British retail sales volume increased by 0.7% for the three month to June 2019 with growth across all sectors except department stores and food stores. However, this was a slowdown compared with the stronger growth of 1.6% in the three months to May 2019.