Great Britain January Retail Sales Analysis Reveals Decline After Inflation

The Office of National Statistics (ONS) in Great Britain reported that retail sales volumes in January 2023 increased by 0.5 percent, following a fall of 1.2 percent in December 2022 (revised from a fall of 1.0 percent). Sales volumes were reportedly 1.4 percent below its pre-COVID-19 February 2020 levels.

Sales volumes fell by 0.9 percent in the three months through January 2023 compared to the previous three months. Compared with the prior-year comparable period, retail sales volumes fell by 5.7 percent in the three months through January 2023. Non-store retailing, predominantly online retailers, sales volumes rose by 2.0 percent in January 2023, with some feedback that January sales promotions supported the rise.

Non-food store sales volumes rose by 0.6 percent over the month, following a fall of 2.5 percent in December 2022 with retailer feedback that growth was supported by sales promotions; despite this pickup, sales volumes were 2.9 percent below their pre-coronavirus February 2020 levels.

The proportion of retail sales online fell to 25.0 percent in January 2023 from 25.7 percent in December 2022. Despite the decline, it remains significantly above pre-coronavirus levels (19.8 percent in February 2020).

The British Retail Consortium noted that while Sales by Value (amount spent) increased 3.7 percent year-over-year, the growth was primarily due to rising prices, highlighting that Sales by Volume (quantity bought) fell 5.3 percent year-over-year.

Responding to the latest ONS Retail Sales Index figures, Helen Dickinson, chief executive of the British Retail Consortium, said: “Widespread January sales helped sales growth remain positive as the industry entered the New Year. Despite this, the rise in consumer spending could not keep up with the double-digit inflation rates, with another fall in retail volumes. Larger purchases were hit harder as consumers tightened their purse strings or traded down to value brands. Meanwhile, clothing and footwear saw stronger growth last month.

“With consumer confidence falling slightly and high costs throughout the supply chain preventing prices from falling, it is a bumpy road for households. However, retailers are taking steps to cut costs and limit price rises where they can to help their hard-pressed customers.”