Deloitte comments on latest ONS retail sales figures
Commenting on the latest figures, Ian Geddes, UK head of retail at Deloitte, said:
“Strong growth in the non-food sector, compared to the first volume and value decline for the grocers in 25 years, shows the continuing polarisation of the retail market. Many consumers are yet to feel the benefits of the economic recovery and are reluctant to let go of their recessionary behaviours, particularly when shopping for food. The rate of inflation fell in July, but year on year prices are rising at a faster rate than wages. This provides a challenging backdrop for the beleaguered grocers. Talk of price-war in the supermarket sector seems at odds with the ONS data, where food retailers were the only sector to see a record a rise in prices, albeit the lowest on record. However, we expect competition to increase in the coming months as the market leaders look to respond to the growing challenge of the discounters.
“Consumers continue to show a willingness to spend on non-food items, but are doing so selectively. Clothing continues its good run, driven by promotions, while the furniture market remains buoyant – positively impacted by growth in the housing market. Although robust, online growth marked a slight slowdown on June, no doubt impacted by the good weather encouraging consumers to get out and enjoy the British summer.”
