The British Retail Consortium Retail Sales Monitor release for December 2016 shows that UK retail sales in this critical festive month grew by 1.7%; underpinned by like-for-like growth of 1.0%. This performance sustained an improving trend seen in the second half of the year, and was ahead of the overall average for the year as a whole; which saw growth running at 1.2%.
'Late' Christmas played a key role
With Christmas falling on a Sunday, and two more trading days that last year before the 25th, December was set to be a waiting game. Indeed the first three weeks of the month saw lower sales than last year, but the Christmas week was an exceptional one thanks to the two additional shopping days, particularly the Saturday. Food was the major contributor to growth, while Non-food was driven by festive items 'at mid-price points'.
Food Q4 boosted to 2.4%
The step up in Food growth in December ensured that this sector achieved a notable improvement in its three-month performance from October to the end of the year. Rising to +2.4% (versus 1.7% for September to November) food and grocery sales growth was well-ahead of Non-food on 1.3%, driving the fastest overall quarterly growth of the year (+1.8%).
Joanne Denney-Finch, Chief Executive IGD commented:
"The grocery year ended on a high, with a substantial sales increase versus December 2015. Shoppers took their Christmas food and drink spending even closer to the wire than usual, with a record-breaking week leading up to the 25th. This sealed a strong second half of the year for food retailers. Looking ahead, eyes are on the possible return of food inflation, with three-quarters (76%) of shoppers anticipating higher prices in 2017. A surge in patriotism could be another important factor, with 45% believing it's more important to buy British-produced food now the UK has voted to leave the EU."