UK retail sales flat for second month

UK retail sales (high-street sales) remained unchanged in November 2013 compared to November 2012, says the Confederation of British Industry (CBI). Retailers had expected some gains.

Among the worst-hit retailers were clothing shops, department stores and grocers, while Hardware & DIY performed strongly, according to the Quarterly Distributive Trades Survey which includes data on 129 firms.

Order-volume placed with suppliers by the retail sector, following lower-than-expected sales was flat in November, having showed signs of growth in the year to October.

Even though UK retail sales remained unchanged, the sector is employing more people now. Retailers say they believe the business situation will improve during the next quarter, and forecast better investment intentions for 2014 (moving from negative sentiment to flat).

Wholesalers’ overall sales were broadly unchanged on a year ago, after five consecutive months of growth. In the motor sector trade sales fell.

Asda Chief Merchandising Officer for Food, Barry Williams, and also Chair of the CBI Distributive Trades Survey Panel, said:

“This is the second month in a row that retailers’ expectations for growth have been
disappointed, perhaps due in part to the mild start to autumn.”

“But despite challenging conditions on the high-street, retailers remain optimistic for the Christmas period, and have taken on more employees in anticipation of a shopping rush that should add jingle to the tills.”

UK retail sales – key findings

  • 35% reported higher sales on a year ago, while 34% experienced a fall. A balance of +1%. Analysts had expected +23%.
  • 41% predict higher sales next month, compared to 18% who expect them to fall. A (rounded) balance of +24%.
  • A decline in sales were reported by clothing shops (-15), grocers (-20%) and department stores (-28%). The hardware and DIY sector reported +100% growth!
  • 26% of retailers placed more orders with their suppliers in November 2013 than in November 2012, compared to 25% who placed fewer orders. A balance of +1%.
  • Employment in the three months to November increased 20%. Retailers expect an increase in December (+15%).
  • 14% of retailers forecast a better business situation over the coming three months, compared to 8% who expect things to deteriorate. A balance of +6%.

UK wholesale sales – key findings

  • 25% reported increased sales on a year ago, while 21% saw sales fall. A (rounded) balance of +3%.
  • Sales in the following sectors grew – durable household goods +20%, building material +56%, and industrial sales +36%.
  • Sales in the following sectors declined – clothing, textiles & footwear, -3%, agricultural & industrial machinery, -15%.

Motor trades – key findings

  • 29% reported higher sales than a year ago.
  • 55% reported lower sales. A balance of -26%. Analysts had expected a balance of +88%.
  • Over the three months more motor traders expect things to improve than to get worse (+25%), this is the highest balance since 40% in 2002.

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