UK DIY News
CBI Distributive Trades Survey August 2024
Retail sales volumes fell for the third consecutive month in the year to August, albeit at a slower pace than in July, according to the CBI’s latest quarterly Distributive Trades Survey. Retailers expect the downturn in sales to ease further in September.
Selling price inflation in the retail sector is set to remain below the long-run average rate next month, while investment and hiring plans are expected to be pared back going forward.
Key findings included:
- Retail sales volumes in the year to August fell at a slower pace than last month (weighted balance of -27% from -43% in July). Retailers expect the sales downturn to ease again next month (-17%).
- Sales for the time of year were reported as “poor” in August, but to a lesser extent than the previous month (-21% from -36% in July). Sales volumes are expected to disappoint again next month (-18%).
- Retailers anticipate a moderate deterioration in their business situation over the next three months (-13% from +2% in May).
- Selling price inflation accelerated in the year to August (+30% from +20% in May) but remained below the long-run average rate (+41%). Retailers expect price inflation to ease next month (+15%).
- Retailers expect to reduce investment in the next 12 months (compared to the past 12) to a larger extent than in May (-35% from -25% in May).
- Retail employment in the year to August declined for the eighth consecutive quarterly survey (-25% from -26% in May). Headcount in retail is expected to contract next month at a broadly similar rate (-28%).
- The total distribution sector (includes retail, wholesale, and motor trades) contracted moderately in the year to August (-20% from -30% in July). Sales are expected to decline at a significantly slower rate in September (-6%).
Martin Sartorius, Principal Economist, CBI, said:
“Retail sales volumes continued to disappoint in the year to August, with contractions also being seen in the wholesale and motor trade sectors. Retailers reported increased caution regarding their investment and hiring plans, which seemed to reflect concerns about persistently weak demand conditions. Although households seem to still be feeling the pinch from the cost-of-living crisis, firms should gradually begin to see some tailwinds from consumers’ rising real incomes.
“The sector will want to see measures in the Budget this autumn to give certainty to firms and incentivise investment. Reforming business rates, introducing a business tax roadmap, and changing the apprenticeship levy would help businesses to deliver on the government’s ambitions to supercharge the economy.”
In addition, data from the survey showed:
- Retail orders placed upon suppliers continued to decline in the year to August, at a broadly similar pace as last month (-42% from -40% in July). Orders are expected to decline again next month but at a more moderate rate (-27%).
- Retailers reported that stock volumes were “too high” in relation to expected sales in August, but to a lesser extent than last month (+14% from +32% in July; long-run average of +17%). Stock positions are expected to remain firm next month (+18%).
- Internet sales volumes contracted at a moderate pace in the year to August (-15% from -7% in July) and are expected to fall at a quicker rate next month (-30%).
- Wholesale sales volumes fell at a gentler pace in the year to August (-7% from -21% in July) and are set to see a mild recovery in September (+6%).
- Motor trades sales volumes declined at the fastest pace since October 2022 (-57% from -29% in July) but are expected to contract at a more moderate pace next month (-25%).
Source : CBI
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Thank you for the excellent presentation that you gave at Woodbury Park on Thursday morning. It was very interesting and thought-provoking for our Retail members. The feedback has been excellent.