With the annualization of the onset of the pandemic impacts from 2020, the latest release from the British Retail Consortium Retail Sales Monitor (BRC-RSM) has switched to reporting a two-year comparative for its March data, in an attempt to indicate the underlying trend in UK retail and smooth the volatility seen last year. This shows that sales in March 2021 were 8.3% higher than 2019, largely driven by persisting elevation in the grocery sector.
Three-month trend weaker on 2.7%
Using a comparison of the January to March period versus 2019 UK retail sales are 2.7% higher, with food retail solely responsible for this growth, with the sector up 11.6% on two years before. Meanwhile non-food sales, are, as would be expected, notably lower versus 2019, down by 4.7%. However, with non-essential (i.e. non-food retail) stores allowed to open once more in April, the decline on 2019 is likely to diminish progressively while food retail growth should moderate.
Non-food online growth ‘slows’ to +65%
Growth in non-food sales online remained very high in March versus 2020, though this is likely to slow as it hits tougher comparatives from April 2020 going forward. This rapid growth has, of course contributed to a massive surge in the share that online now takes of non-food retail. Standing at 58.0% in March 2021, online now holds a share twice that seen in March 2019. Across the sector as a whole there are now a significant number of segments where online accounts for upwards of 70% (and even over 90%) of all sales.
Susan Barratt, Chief Executive, IGD commented:
‘Food and grocery showed a more restrained performance in March, following a strong February and nearly 12 months of elevated performance through the pandemic. However, March was still not a return to what we would usually expect for the time of year, as it was further distorted by the changed timing of Easter. Additionally, trading conditions have still been affected by the ongoing closure of non-essential retail and the out-of-home sector. We are unlikely to see a more settled, post -pandemic food and grocery performance until after restrictions further ease through April and May. IGD’s Shopper Confidence Index remained at its highest level since January 2020. Confidence improved towards the end of March as lockdown began to lift and the focus turned to outdoor family gatherings over Easter. While shopper sentiment is likely to improve as the economy opens up from April, confidence is likely to remain polarised, with confidence elevated among higher affluence groups but remaining fragile among lower affluence groups.’