UK retail sales rose 2.6% in January, beating expectations. Non-food sales showed a strong recovery, up 2.5%, led by in-store sales (up 2.6%). Online sales of non-food products rose 2.2%, although online penetration fell slightly.
Helen Dickinson (British Retail Consortium) highlighted strong in-store sales growth, attributed to discounts and home improvement purchases, but warned that rising costs for retailers could lead to price increases. Linda Ellett (KPMG) noted that despite growth in January, non-food sales remained flat in the quarter covering Christmas and Black Friday, amid a challenging economic backdrop for retailers.
Sarah Bradbury (IGD) noted a decline in consumer confidence, with a shift towards private label products and spending control strategies, anticipating further price increases in the food sector. Rising business costs, including national insurance contributions and the minimum wage, are a significant challenge for retailers.
The food sector recorded a 2.8% increase in sales, down from 6,1% the previous year. Economic uncertainty continues to influence consumer spending habits, with an increasing focus on cost containment.
