Trend Analysis: U.K. Retail Sees Bounceback

The U.K. is on the edge of easing lockdowns, and as we prepare to enter a new normal, reports are emerging surrounding a promising bounceback at retail.

Ben Roberts, Content Director

July 13, 2021

3 Min Read

The British Retail Consortium has revealed that sales have increased 13.1 percent in June against the decline of 1.3 percent in June 2019. With strong growth in-store in June, U.K. shoppers leaned toward the fashion and footwear markets, while the Euro 2020 football tournament fueled sales across TVs, snack foods and beer. 

"The second quarter of 2021 saw exceptional growth as the gradual unlocking of the UK economy encouraged a release of pent-up demand built up over previous lockdowns," says Helen Dickenson, chief executive, British Retail Consortium. "In June, while growth in food sales begun to slow, non-food sales were bolstered by growing consumer confidence and the continued unleashing of consumer demand. With many people taking staycations or cheaper UK-based holidays, many have found they have a little extra to spend at the shops […] Nonetheless, U.K. retail is still facing strong headwinds with many retailers still making up for ground lost during the previous lockdowns. City center retailers continue to suffer low footfall and spending as commuters and international tourist numbers remained well below pre-pandemic levels. Consumer comfort with the next stage of the roadmap will be key to the ongoing success of retail. Many customers are looking forward to a return to a more normal shopping experience, while others may be discouraged by the change in face-covering rules." 

The food and beverage sector has continued its growth with one in five shoppers (22 percent) making more trips to stores to buy food and groceries – compared to just 15 percent in May – more established shopping behaviors are due to return, according to Susan Barratt, chief executive officer, IGD. With consumers releasing their pent-up demand for retail therapy, Paul Martin, head, U.K. retail, KPMG, also notes that the fight for wallet share is underway once again, especially across e-commerce.  

"Retail sales growth continued in June, albeit at a slower rate as the re-opening of hospitality and leisure sectors led to a dilution in consumer spending," says Martin. "The fight for share of wallet is underway, as consumers unleash pent-up demand for social activities as restrictions in the UK continue  to unwind. While the high street saw continued growth in June, with sales up 10%, online sales fell by 7 percent compared to June 2020. However, penetration rates for online sales remain much higher than their pre-pandemic levels, suggesting the shift to online is here to stay. Sales of men's and women's clothing and footwear have started to recover with double-digit growth across all channels. Still, there were unsurprising declines across those categories which had seen a boom in lockdown, such as technology and home accessories and furnishings." 

All signs to the positive as these results link with the forecasts of a report created by and Centre for Retail Research, noting that U.K. retail sales will grow 5 percent on 21 to reach £429 billion by 2022 thanks to a steadily growing economy. Now, thanks to recent findings by The British Retail Consortium, the U.K. is facing the best quarter on record with an even more promising future leading into 2022. 

About the Author(s)

Ben Roberts

Content Director, License Global

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