Analysing Retail Sales & Managing Voids

UK retail sales returned to growth in July, following 3 months of consecutive declines. The strong summer sunshine over the month, peaking in the mid-month heatwave gave demand a boost, led both Food and Non-Food to see growth for the first time since December to 2.3%.

Vacancy rates continued to travel in the right direction, with the third consecutive quarter of improvement, though rates remain almost two percentage points above pre-pandemic levels. There remains a significant North-South divide, with the North of England, along with Scotland and Wales, having a higher proportion of empty shops, though this gap is narrowing, with greater improvement being seen in Northern England. Shopping centres continue to lag behind high streets and retail parks; a situation exacerbated by the bigger challenges associated with redeveloping shopping centre units. This has led to a rise to over nine percent in empty shopping centre units which has been closed for two or more years.

NOTES

The BRC-KPMG Retail Sales Monitor measures changes in the actual value (including VAT) of retail sales, excluding automotive fuel. The Monitor measures the value of spending and hence does not adjust for price or VAT changes. If prices are rising, sales volumes will increase by less than sales values. In times of price deflation, sales volumes will increase by more than sales values.

Retailers report the value of their sales for the current period and the equivalent period a year ago. These figures are reported both in total and on a ‘like-for-like’ basis. Total sales growth is the percentage change in the value of all sales compared to the same period a year earlier. The total sales measure is used to assess market level trends in retail sales. It is a guide to the growth of the whole retail industry, or how much consumers in total are spending in retail – retail spending represents approximately one-third of consumer spending. It is this measure that is often used by economists. Many retailers include distance sales as a component of total sales.

Source: BRC-KPMG RSM (Includes Food data from IGD)