DIpil Das
UK retail sales grew 2.3% in February, but this was the calm before the storm. March has seen shoppers panic buy and stock up on essentials; businesses (including many retailers) scale down or close operations; and, late in the month, a national lockdown. In March, we expect grocery stores saw a double-digit increase in sales, but that discretionary sectors saw deep declines.
[caption id="attachment_106671" align="aligncenter" width="700"]
Data in this report is not seasonally adjusted
Source: ONS/Coresight Research [/caption] Retail Sales Growth by Sector The figures for February are unlikely to be representative of current and forthcoming trends across most sectors. One exception could be Internet-only retailers: we expect this sector grow due to store closures and consumer stockpiling—the latter of which has likely boosted Ocado in particular and, presumably, Amazon, too. At the same time, online retailers are likely to see subdued underlying demand for discretionary goods, likely impacting pure plays such as ASOS and Boohoo Group. The ONS recorded shop-price inflation of just 0.2% in February, down from 0.7% in January. In February, food-store inflation stood at 1.0%, versus 1.5% in January, and nonfood retailer inflation stood at (0.3)%, versus 0.2% in January. [caption id="attachment_106672" align="aligncenter" width="700"]
*A small retailer is defined as one with fewer than 100 employees or with revenues of £60 million or less per year; all others are large retailers
**A relatively fragmented sector, in which reported figures have traditionally been volatile
Source: ONS [/caption] Online Retail Sales Growth Total Internet retail sales were up 5.3% year over year in February, versus 7.4% in January. For food retailers, Internet sales were up 1.4% in February, versus 1.7% in January; this growth rate is likely to accelerate very strongly in March, as UK shoppers turned in huge numbers to online grocery services. In February, Internet sales were up 4.1% at store-based nonfood retailers, reversing January’s 1.0% decline as online declines eased at department stores/mixed-goods retailers. Online sales were up 7.1% at nonstore retailers.
Data in this report is not seasonally adjusted Source: ONS/Coresight Research [/caption] Retail Sales Growth by Sector The figures for February are unlikely to be representative of current and forthcoming trends across most sectors. One exception could be Internet-only retailers: we expect this sector grow due to store closures and consumer stockpiling—the latter of which has likely boosted Ocado in particular and, presumably, Amazon, too. At the same time, online retailers are likely to see subdued underlying demand for discretionary goods, likely impacting pure plays such as ASOS and Boohoo Group. The ONS recorded shop-price inflation of just 0.2% in February, down from 0.7% in January. In February, food-store inflation stood at 1.0%, versus 1.5% in January, and nonfood retailer inflation stood at (0.3)%, versus 0.2% in January. [caption id="attachment_106672" align="aligncenter" width="700"]
*A small retailer is defined as one with fewer than 100 employees or with revenues of £60 million or less per year; all others are large retailers **A relatively fragmented sector, in which reported figures have traditionally been volatile
Source: ONS [/caption] Online Retail Sales Growth Total Internet retail sales were up 5.3% year over year in February, versus 7.4% in January. For food retailers, Internet sales were up 1.4% in February, versus 1.7% in January; this growth rate is likely to accelerate very strongly in March, as UK shoppers turned in huge numbers to online grocery services. In February, Internet sales were up 4.1% at store-based nonfood retailers, reversing January’s 1.0% decline as online declines eased at department stores/mixed-goods retailers. Online sales were up 7.1% at nonstore retailers.