The British Retail Consortium (BRC) has reported one of the worst months for the retail sector this year in October, with the reported figures being 0.1 per cent lower on a like-for-like basis.
Following a surprise hike in September when like-for-like sales were up 1.5 percent and total sales were up 3.4 percent, which had raised hopes for a retail revival last month, only food and drink remained steady, as shoppers spent on essentials but held back on discretionary buying.
As a result, total sales were only up 1.1 percent, against a 1.5 percent rise the year before, which was the slowest growth in total sales, excluding Easter, since November 2011.
The latest figures show that clothing and footwear saw a boost at the beginning of the month as consumers filled their wardrobes with jumpers, coats and trousers. However, sales tailed off towards the end of the month as many shoppers became more cautious again.
Worst hit was the home accessories sector, which according to the BRC was not considered essential enough to attract the “consumer with little spare money”. Overall, the figures suggest that winning a share of the Christmas wallet will be just as competitive over the next two months as it was last year.
Coupled with news that the Purchasing Managers Index (PMI) for services has fallen to 50.6, indicating that growth in the sector, which accounts for three-quarters of UK GDP, has dropped to nearly nothing, there are even fears with the retail figures that the country could slip back into recession for the third time.
As an accountant, Sarah Jenkins, specialises in management accounting, business development and financial reporting.