DICKINSON
Helen

Retail sales growth slowed significantly last month as consumer confidence “continued to sink” amid the cost of living crisis, new research has revealed. It comes as a rise in household bills, food and fuel has started to affect customer spending patterns, separate research from Barclaycard found. Experts added that the growth in total sales in March was buoyed by price rises across the retail sector. The latest BRC-KPMG retail sales monitor revealed that total sales increased by 3.1 per cent in March, slipping back from a 6.7 per cent rise in February. The new data highlights the new challenge for the retail sector just two years blighted by the pandemic. The BRC-KPMG data showed that like-for-like retail sales were down 0.4 per cent against the same month last year. Helen Dickinson, chief executive of the British Retail Consortium (BRC), said: “As consumer confidence continued to sink, March saw sales slow, and while spend remained above last year this likely reflects higher prices. “[cite=51]The rising cost of living and the ongoing war in Ukraine has shaken consumer confidence, with expectations of people’s personal finances over the next 12 months reaching depths not seen since the 2008 financial crisis.[/cite] “Furthermore, households are yet to feel the full impact of the recent rise in energy prices and national insurance changes. “Ultimately, consumers face an enormous challenge this year, and this is likely to be reflected in retail spend in the future.” The figures also showed that online non-food sales dropped by 29 per cent over the three months to March as the pandemic-fuelled digital boom continued to recoil. However, Don Williams, retail partner at KPMG, said that online “penetration rates remain high” as they were compared with a period of shop closures a year earlier. Meanwhile, total food sales decreased by 2.6 per cent over the three months to March. Susan Barratt, chief executive officer of the Institute of Grocery Distribution (IGD), added: “Food and drink sales struggled in March, partly due to facing strong comparatives to 2021. “Not only were sales elevated last year due to lockdown, but Easter was also earlier and we’re yet to see holiday spending ramp up this year. “It is no surprise that shopper confidence continues to fall and is now lower than the previous low of December 2013 when the horsemeat scandal impacted the food industry.” Elsewhere, Barclaycard’s latest credit card data showed that consumer spending was still significantly ahead of pre-pandemic levels as people spent more on hospitality, but still highlighted some pressure on consumer confidence. Card spending in March increased by 17.7 per cent against levels from the same month in 2019, as people spent more on essential items. The increase was particularly driven by a higher spend on fuel, which soared by 26.1 per cent after prices rocketed. Jose Carvalho, head of consumer products at Barclaycard, said: “Many sectors saw strong growth in March compared to the same period in 2019, as sunnier weather encouraged Brits to socialise at pubs and bars, book staycations and update their wardrobes for spring and summer. “However, rising fuel prices and household bills are clearly starting to influence consumer behaviour, with many Brits changing their travel and shopping habits to save money. “While this may dampen growth in the months ahead, we shouldn’t overlook the expected heatwave later in April, and the fast-approaching Easter holidays, both of which are likely to boost non-essential spending.” Source: https://www.independent.co.uk/news/uk/home-news/retail-cost-of-living-crisis-consumer-spending-b2055552.html

Retailers are urging the government to bring forward changes to self-isolation policies planned for August as they warn of rapidly increasing staff shortages related to Covid. Richard Walker, the boss of the Iceland grocery chain, said that staff absences linked to coronavirus were “growing exponentially”. “Within a week or two they’ll be the highest ever,” he wrote on Twitter. “[cite=48]Covid rules end 19 July. Self-isolation rules not eased until 16 August. It will be a bad show for business.[/cite]” His warning came after the boss of the Sainsbury's supermarket group, Simon Roberts, said on Tuesday that there had been an “uptick in absence” related to Covid at the retailer in recent weeks. It is understood that at least one other major supermarket is experiencing serious problems at its distribution centres as a result of staff needing to self-isolate alongside a general shortage of workers caused by a mix of Brexit and Covid. Under the current rules, workers who have come within 2 metres of a person with the virus must stay at home for 10 days even if they are vaccinated and have tested negative. On Tuesday, the health secretary, Sajid Javid, said that from 16 August, close contacts of people in England who have tested positive for Covid will no longer have to self-isolate if they have received both vaccinations or if they are under 18. However, this change in the rules will come almost a month after the 19 July end of social distancing rules for hospitality businesses, which is expected to increase demand for staff, adding to existing pressure from shortages. Helen Dickinson, chief executive of the British Retail Consortium, which represents most of the UK’s major retailers, said: “[cite=51]We are already seeing a serious impact on retail operations as a result of staff having to self-isolate and this will only get worse right across the economy, as cases are already rising fast and the final restrictions are eased.[/cite] “Given the effectiveness of the current vaccine roll-out programme, the government should pull forward the 16 August date so that people who are fully vaccinated or have a negative test are not forced to needlessly quarantine when they are contacted by track and trace.” Hospitality bosses have warned that the self-isolation regime is “wreaking havoc” on bars, restaurants and hotels already suffering from Brexit-related staff shortages. Venues have been forced to temporarily close or cut trading hours, when as little as one member of staff had come into contact with someone with the virus. Source: https://www.theguardian.com/business/2021/jul/07/retailers-call-for-early-easing-of-self-isolation-rules-in-england