UK non-essentials spending plunges say Barclaycard, BRC
There was bad news for UK retail on Thursday as consumer spending dropped, despite spikes in supermarket sales.
Barclaycard’s monthly report showed consumer spending (including retail sales, as well as spending on items like travel and visits to cinemas and pubs) dropped 6% year-on-year in March. That came as measures to tackle coronavirus were introduced, although some retailers saw strong growth.
Spending at supermarkets rose 21.3% and specialist food & drink stores 30.5%. Online purchases rose 5.5% while in-store transactions dropped 4%. And confidence in the UK economy fell to 25%.
The month was largely about people buying essentials, with spending in this area up 11.6%. But non-essentials fell 12.9%. As the month included two weeks when shops were allowed to remain open, it suggests that non-essential spending is set to have plummeted even further when April’s figures come out.
On the upside, discount stores saw increased demand as shoppers sought value for money, rising 25.2%. And pharmacy, health & beauty was up 0.5%, although spending here is likely to have been skewed towards essentials.
Meanwhile, the monthly British Retail Consortium (BRC) and KPMG retail sales report also showed a sharp decline. Total retail sales fell 4.3% according to this report, compared to a 1.8% decline for the same month last year. It was the biggest decline in the report’s 25-year history.
In the first three weeks of March, sales actually rose 12% but then plunged 27% once the lockdown started.
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