Retail braved a stormy start to the year to deliver strong trading as January Sales drove the strongest performance by stores in nearly two years.
For the five weeks to February 1, 2025, UK total retail sales increased by 2.6% year on year, compared to just 1.2% growth in January 2024, according to the latest BRC-KPMG Retail Sales Monitor.
Food sales increased by 2.8% year on year for the same period, compared with 6.1% growth in 2024 – driven at the time by surging inflation and the cost-of-living crisis.
In better news for the sector, non-food sales jumped 2.5%, compared to a 2.8% decline for the same period in 2024. In-store non-food sales jumped 2.6%, compared to a 2% decline in January 2024.
Online non-food sales also increased in the period, up 2.2% while the online penetration rate dropped to 35.7% as cash-conscious shoppers flocked to stores to hunt down January sales.
BRC chief executive Helen Dickinson said: “January sales kicked off a solid month for retail with stores delivering their strongest growth in almost two years, albeit on a weak comparable. Consumers headed to the shops to refresh their homes for the year ahead, taking advantage of big discounts on furniture, bedding and other home accessories. With growth across nearly all categories, only toys and baby equipment remained in decline. While the bouts of stormy weather put a temporary dampener on demand, sales growth held up well throughout the rest of the month. This was also helped by the earlier start of the reporting period, adding a few more post-Christmas shopping days into the mix.
“Whether this strong performance can hold out for the coming months is yet to be seen. Inflationary pressures are rising, compounded by £7bn of new costs facing retailers, including higher employer national insurance contributions, higher National Living Wage, and a new packaging levy. Many businesses will be left with little choice but to increase prices, and cut investment in jobs and stores. Government can mitigate this by ensuring its proposed business rates reforms do not result in any shop paying more in business rates.”
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