Consumer demand cools as temperatures soar
Covering the 4 weeks from 5 July – 1 August 2026
- UK Total retail sales increased by 1.3% year on year in July, against a growth of 2.5% in July 2025. This was below the 12-month average growth of 1.8%.
- Food sales increased by 3.8% year on year in July, against a growth of 3.9% in July 2025. This was above the 12-month average growth of 3.4%.
- Non-Food sales decreased by 0.7% year on year in July, against a growth of 1.4% in July 2025. This was below the 12-month average growth of 0.4%.
- In-Store Non-Food sales decreased by 1.9% year on year in July, against a growth of 1.9% in July 2025. This was below the 12-month average decline of 0.2%.
- Online Non-Food sales increased by 1.3% year on year in July, against a growth of 0.3% in July 2025. This was below the 12-month average growth of 1.6%.
- The online penetration rate (the proportion of Non-Food items bought online) increased to 35.9% in July from 35.4% in July 2025. This was below the 12-month average of 38.0%.
Helen Dickinson, chief executive at the British Retail Consortium, said: “July saw modest sales growth, with food sales boosted by the final week of the World Cup. Non-food sales were hit by the decline in footfall as shoppers avoided the heat. Clothing was a bright spot, driven by demand for affordable summer essentials, while footwear struggled to keep up. Shoppers also prioritised smaller indulgences such as beauty products and fashion jewellery, while delaying bigger-ticket purchases including furniture and computing.
“Consumer demand has struggled in the heat, leaving retailers facing a challenging start to the second half of the year. Household budgets remain stretched, consumer confidence is fragile, and retailers continue to grapple with rising operating costs. If the Government wants to drive growth and keep inflation under control, it must reduce the cost of doing business by tackling the taxes and regulatory burdens that are holding back investment and putting upward pressure on prices. These include business rates, new packaging taxes, and the rising costs of employment.”
Linda Ellett, UK head of consumer, retail & leisure, KPMG, said: “Despite summer season getting started as early as May, the upturn for clothes, shoes and accessories has continued right through to August. The prolonged warm weather has also aided home entertaining and garden related purchases and, coupled with England’s progress to the tail-end of the World Cup, brought a boost to food and drink sales in July.
“With spend focussed on summer related purchasing, other non-food categories fared less well – limiting total non-food sales growth overall.”
Sarah Bradbury, CEO, IGD, said: “July brought a welcome uplift in shopper confidence. Easing inflation, a new government, continued warm weather and England’s World Cup run helped boost sentiment with sales and volumes increasing compared to July 2025. However, while shoppers are feeling more positive than earlier in the year, many households remain mindful of their budgets, meaning value continues to play a central role in purchasing decisions. Despite this month’s improvement, pressures are building across the food supply chain as a result of the conflict in the Middle East and prolonged hot weather, increasing the likelihood of higher food costs and renewed pressure on household budgets as we move into the autumn.”