Demand for beer and party food for Rugby World Cup watchers and school shoes for the new term helped lift retail sales last month, reports The Guardian.
In the latest report to indicate consumer spending remains the main driver of economic growth, the British Retail Consortium (BRC) said like-for-like sales grew at the fastest annual pace for six months in September.
The business group said furniture and footwear sold particularly well. Food and drink were helped by the rugby as well as a pick-up in demand for home-baking productsas the latest season of The Great British Bake Off approached its final.
After a sales slide in August, the latest figures showed a stronger finish to the summer, said David McCorquodale, head of retail at KPMG, the report’s co-author.
“Fashion sales were given a particular boost in September, with more autumnal weather encouraging shoppers to check out the new season ranges and last-minute back-to-school purchases lifting sales of children’s clothes and shoes. Home and furniture also benefited from the bank holiday timing as consumers took the opportunity to fit in a bit of redecorating,” McCorquodale said.
Sales values were 2.6 per cent higher than in September 2014, marking a rebound from August when they fell an annual 1.0 per cent. But the results were distorted by the timing of the late August bank holiday, which the BRC counted in August last year and September this year.
Growth was also stronger when taking the latest three months together to iron out those distortions. Like-for-like sales for July to September were up 1.1 per cent on a year ago, the fastest growth since the opening three months of the year.
While sales of non-food items continue to grow, retailers’ takings from food sales have been falling, partly because of a supermarket price war. Food sales declined 1.4 per cent in like-for-like terms during the past three months, while non-food sales rose 3.1 per cent.
“Retailers are seeing some improved consumer demand but they continue to operate in a very competitive environment,” Helen Dickinson, the BRC’s chief executive, said. But food sales were up 0.2 per cent over July to September on a total basis, which does not adjust for the effect of new store openings.
Economists say, in contrast to the struggling manufacturing and construction sectors of the economy, consumer spending is being boosted by a gradual pick-up in wages, continued record low interest rates and low inflation. Official figures published on Tuesday are expected to show inflation held at zero in September, with some forecasters predicting the rate dipped to -0.1 per cent.
The combination of low prices and rising pay recently prompted retailers to say they were experiencing the best business conditions since before the financial crisis erupted in 2007. In a poll by the business group CBI, retailers also said they were upbeat about this month and believed consumers would continue to spend freely.
