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Retail Sales Volumes Decline By 8.2% In January

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The ONS has published retail sales data for the four-week period 3 January 2021 to 30 January 2021.

  • In January 2021, retail sales volumes decreased by 8.2% when compared with December 2020 as tighter nationwide coronavirus (COVID-19) restrictions affected sales.

  • Retail sales volumes were 5.5% lower than before the pandemic in February 2020 indicating that the impact of restrictions on the retail sector was not as large as that seen in April 2020 during the first full month of retail restrictions when sales fell by 22.2% when compared with levels before the pandemic.

  • All sectors saw a monthly decline in volume sales in January 2021 except for non-store retailers and food stores, who reported growth of 3.7% and 1.4% respectively when compared with December 2020.

  • In the three months to January 2021, retail sales volume fell by 4.9% when compared with the previous three months, with strong declines in both clothing stores and automotive fuel.

  • The proportion spent online soared to 35.2% in January 2021, the highest on record; this compares with 29.6% in December 2020 and 19.5% reported in January 2020.

  • All store types reported an increase in their proportion of online spending in January 2021 when compared with December 2020; with food stores reaching an historic high of 12.2% of sales conducted online. 

  • The proportion of online retail increased to a record level in January 2021 reaching 35.2% up from 29.6% in December 2020 and was far higher than the 19.5% in January 2020, reflecting the impact the pandemic has had on consumer behaviours. Food stores also reported a record proportion of online sales this month of 12.2% with anecdotal feedback from retailers suggesting that click and collect food orders had boosted online sales.

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Commenting on the Office of National Statistics retail sales figures for January 2021, Lisa Hooker, consumer markets leader at PwC, said: 

“With non-essential high street retail all but closed last month, it was no surprise that retail sales declined by -8.3% compared with December, and by -4.3% compared with last January. 

“However, there are signs that retailers have adapted better to the latest lockdown. While non-grocery stores took the brunt of the pain, with sales volumes declining by a quarter, they were still over 50% higher than in the first lockdown last April. 

“As with last year, online made up the slack, with consumers turning to their phones and PCs to shop in record levels. Over 35% of retail sales were online in January, even higher than the previous peak of 34% in May 2020. And with less demand than the traditional Christmas period, online penetration of grocery sales also reached a new peak of over 12%. 

“Looking forward, all eyes will be on the Prime Minister’s announcement of a reopening timetable expected this Monday - as well as the Budget on 3 March. While the first quarter of the year is traditionally quieter for retailers, stores will be hoping that a rapid re-opening will allow shoppers to spend what they may have saved by postponing holidays and not going out during the lockdowns. 

“Retailers will also be hoping for extensions to government support, such as the furlough scheme beyond April, and the commercial property moratorium on evictions and the business rates holiday beyond March, as has already happened in Scotland.”

Source : ONS and PwC

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19 February 2021

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