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Furniture and appliances contribute to retail sales recovery in January

Retail sales rebounded last month as shoppers spent more on furniture and household items, new figures show.

BRC-KPMG’s latest retail sales monitor for January revealed that total sales jumped 11.9% from the same month last year, although this was bolstered by significant price inflation.

Stores saw customers return after a December crippled by Plan B restrictions and rising rates of Covid-19 cases, which disrupted the key Christmas period.

Retailers, whose stores were largely closed in January 2021 due to restrictions, said like-for-like sales last month were up 8.1% from 2021 levels.

Retail experts said the easing of restrictions, however, reduced grocery sales, with total food sales falling 0.1% over the past three months.

Helen Dickinson, chief executive of the British Retail Consortium (BRC), said: “Food sales were weaker than in previous months as people started eating more often again.

“Consumers have prioritized home shopping, which has boosted the sale of appliances, electronics and housewares.

“In what could be signs of a return to pre-pandemic trends, furniture performed best in January, after transport delays over the Christmas period began to ease.”

Sales of non-food items, ranging from fashion to home furnishings, rose 11.1% in the three months to January, compared with the same period a year earlier.

Unsurprisingly, store sales jumped more than two-thirds as stores were largely closed in the same period last year.

As a result, online sales of non-food items fell 24.2% in January as customers shifted some of their shopping habits back to physical stores.

Paul Martin, head of UK retail at KPMG, said retail performance was “exceptionally strong” as January is generally a slower month for the sector.

He added: “With Covid restrictions now eased and people returning to workplaces, retailers are hoping consumer confidence remains strong to help offset the growing cost challenges they are likely to face during a time.

“We could see a tough few months ahead if broader macroeconomic conditions start to reduce household incomes to the point that they start to cut retail spending.

“Retailers face their own inflationary pressures and will need to make tough decisions about whether and how to pass on the rising costs they have been sitting on for some time to consumers facing their own financial difficulties.”

Food sales have been reduced, data shows

Separate figures from Barclaycard showed a slowdown in credit card spending as restrictions in January hampered hotel businesses.

The company said spending on essentials rose 10.4% for the month, although this reflected a slowdown as people spent less on fuel as people worked from home.

Hospitality and leisure spending fell 6.3% as five consecutive months ended after advice on working from home and messages encouraging people to socialize less often.

Jose Carvalho, head of consumer products at Barclaycard, said: “The Covid restrictions in January, combined with the rising cost of living, clearly had an impact on consumer spending levels in January.

“While restaurants and bars, pubs and clubs have inevitably been hampered by the ongoing pandemic, there are signs of better times ahead for hospitality as Britons say they plan to spend more on eat and drink at restaurants to lift your spirits during the winter months. ”

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