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Published
Jan 19, 2018
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Fashion stronger than expected in otherwise weak December as online shines

Published
Jan 19, 2018

It wasn’t a wipe-out, but it also wasn’t brilliant news either as the UK’s Office for National Statistics (ONS) reported official December retail sales figures on Friday with just a 1.4% volume increase year-on-year.


Non-food categories did better than expected in the UK at Christmas, especially online



But there were certainly some surprises. Despite a raft of earlier releases suggesting that shoppers spent their money on essentials like food rather than discretionary items like fashion, the ONS actually said that as the total volume of goods sold rose, there were positive contributions from all sectors except foods. 

And the ONS also said the end of the year really did underline changes in consumer behaviour as the Christmas season’s busiest time shifts and as shoppers redistribute their spending.

“Consumers continue to move Christmas purchases earlier, with higher spending in November and lower spending in December than seen in previous years,” it said, adding that “the longer-term picture is one of slowing growth, with increased prices squeezing people’s spending.”

That squeeze becomes clearer if we look at the wider Christmas season. Sales volumes declined 1.5% compared to November as the ONS confirmed that Black Friday and its discount frenzy has changed UK Christmas shopping beyond all recognition. Britons are fixated on bargains, it seems.

ANNUAL SLOWDOWN

Year-on-year sales rose 4.4% by value in December, but with inflation running at about 3.1%, most of that was taken up by higher prices.

For the whole of 2017, the retail sales volume increase was higher than December’s at 1.9%, but that was the lowest annual growth since 2013. After a decline of 0.8% in 2010 and flat figures in 2011, the quantity bought began to increase steadily up to 2016 when the growth rate reached 4.7%. This clearly slowed considerably last year.

And December certainly added to that slowdown when it comes to physical stores, even though it was a good month online,

In fact, the statistics body highlighted the relentless rise of e-shopping saying that “over the year the proportion of internet spending is continuing to rise, with almost one in every £5 spent online by the end of 2017.”

It’s interesting though that for December, while internet sales continued to increase when compared with previous years, omnichannel businesses that also have physical stores dominated online sales growth.

And both multibrand and specialist retailers seem to have benefitted from this. The figures showed non-food e-tailers accounting for 35% of all e-sales last month with department stores making up 15.8% of all online retailing and textiles, clothing and footwear stores 16.8%. The overall growth rate for e-tail was 9.4% but department stores managed to push this higher, to 11.1% while specialist fashion stores saw a 20.9% leap overall.

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