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January 9, 2020

UK retail sales “worst on record” in 2019

UK retail sales had their worst year on record in 2019, new figures show, as shop closures, company voluntary arrangements, job losses and the prospect of a no-deal Brexit all took their toll.

By Michelle Russell

UK retail sales had their worst year on record in 2019, new figures show, as shop closures, company voluntary arrangements, job losses and the prospect of a no-deal Brexit all took their toll.

According to figures from the British Retail Consortium (BRC), total sales fell 0.1% last year, marking the first annual sales decline for 25 years. This compared with 1.2% growth in 2018.

For the months of November and December, total sales were down 0.9% on the prior year, partly driven by a 2.6% increase in online non-food sales. Like-for-like sales, meanwhile, declined 1.2%.

For the two month period, the online penetration rate was 34.2% for 2019, against 32.4% for 2018, a 1.8 percentage points increase.

“2019 was the worst year on record and the first year to show an overall decline in retail sales,” said BRC chief executive Helen Dickinson. “This was also reflected in the CVAs, shop closures and job losses that the industry suffered in 2019. Twice the UK faced the prospect of a no-deal Brexit, as well as political instability that concluded in a December General Election – further weakening demand for the festive period.

“The industry continues to transform in response to the changing technologies and shopping habits. Black Friday overtook Christmas as the biggest shopping week of the year for non-food items. Retailers also faced challenges as consumers became both more cautious and more conscientious as they went about their Christmas shopping.”

The figures highlight a troublesome year for the UK high street, which saw thousands of stores close. Fashion chains including Karen Millen, Forever 21 and Coast went into administration, while retail giant Arcadia and Laura Ashley closed stores under restructuring.

Dickinson adds: “Looking forward, the public’s confidence in Britain’s trade negotiations will have a big impact on spending over the coming year. There are many ongoing challenges for retailers: to drive up productivity, continue to raise wages, improve recyclability of products and cut waste. However, this takes resources, so it is essential the new Government makes good on its promise to review, and then reform the broken business rates system which sees retail pay 25% of all business rates, while accounting for 5% of the economy.”

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