The onset of the festive season brought unexpected challenges for retailers as November sales declined.
- Data from the British Retail Consortium reveals a 3.3% drop in total sales in November, compared to a 2.6% rise last year.
- The decline is beyond the 12-month average growth of 0.5%, highlighting the severity of the situation.
- Despite an increase in food sales, non-food sales saw a significant decrease, particularly online.
- Black Friday’s shift to December and low consumer confidence were major factors influencing sales trends.
Retailers faced significant hurdles as the festive period began, with November witnessing a downturn in sales. This period traditionally marks a peak in retail activity, but current figures highlight a different narrative this year. According to the British Retail Consortium (BRC), overall sales experienced a 3.3% decrease compared to last November’s 2.6% growth, a stark contrast to the 12-month average growth of 0.5%. This trend suggests cautious consumer behavior amid economic uncertainties.
While food sales did see a modest year-on-year rise of 2.4% over the three months leading to November, this was a sharp drop from the 7.6% growth seen in 2023 and even lower than the average of 3.7%. In contrast, the non-food sector suffered a 2.1% decline over the same period. Online retail was particularly hard hit, with non-food online sales plummeting by 10.3%, illustrating a marked change in consumer buying patterns.
Helen Dickinson, CEO of the BRC, attributed the poor start to the festive season to the repositioning of Black Friday into December’s sales figures this year. Nevertheless, she also noted that persistent low consumer confidence and rising energy bills have adversely affected non-food spending. The fashion segment, in particular, struggled as people postponed winter clothing purchases. Health-related products, however, saw an upturn due to seasonal illnesses.
Retailers are hopeful that the shift in Black Friday will not lead to a reduction in overall seasonal spending. According to Linda Ellett from KPMG UK, the industry’s hope is pinned on consumers making strategic spending decisions, holding off spending till the promotional period of late November. Should this strategy falter, early Christmas discounts might become necessary to salvage what could otherwise be a disappointing sales month.
The retail sector is navigating uncertain waters, adapting to consumer behavior shifts while hoping for a fruitful December.
