UK retail sales inch up but gloomy weather drags down fashion

Total retail sales inched up by 1.1% year on year in February, compared to a 1.1% jump in February 2024, according to the latest BRC-KPMG Retail Sales Monitor. This was below the 3-month average growth of 2.4% and above the 12-month average growth of 0.8%.

Food sales were up 2.3% year on year in February, against a 5.6% growth in February 2024.

Non-food sales were flat year-on-year for the period, against a decline of 2.7% the previous year.

In-store non-food sales decreased by 1% over the period, compared to a 1.8% decline in February 2024, while online non-food sales increased by 1.9% compared to a 4.1% decline in the same period last year.

Online penetration rate jumped to 36.4% over the period, compared to 35.8% in February 2024.

British Retail Consortium chief executive Helen Dickinson said: “Retail sales saw more modest growth in February. While sales growth across non-food categories was generally muted, it was propped up by online purchases, particularly in computing and electronics. Jewellery, watches and fragrance sold well thanks to Valentine’s Day, reversing declines seen last year, and furniture also returned to growth.

“Fashion performed poorly due to the gloomy weather throughout the month, but retailers are hopeful that the early March sunshine kickstarts spending on Spring and Summer wardrobes.”

“This weak performance makes many retailers uneasy, especially as they brace for £7bn of new costs from the Budget and packaging levy in 2025, as well as the potential impact of the Employment Rights Bill.

“The industry is already doing all it can to absorb existing costs, but they will be left with little choice but to increase prices or reduce investment in jobs and shops, or both.

“The focus of the Employment Rights Bill should be on unscrupulous employers, but instead the industry faces ongoing uncertainty and a trajectory that risks punishing responsible businesses who provide valuable employment, particularly at entry level. It is time for the government to course correct to ensure investment and growth are not undermined.”