Flat August retail sales 'incredibly disappointing', BRC says

Retail sales "flatlined" in August even as food and drink purchases leapt amid a summer heatwave, according to figures released on Tuesday by the British Retail Consortium (BRC) and KPMG.

Overall, like-for-like retail sales dropped 0.5% during the month despite a weak comparative period in 2018, as sales of non-food items fell by 1.2% in the three months ended 31 August amid a period of political uncertainty that saw consumers keep their purse strings tight.

Even online non-food and drink sales slowed, with growth dropping from 7.5% in August 2018 to 2.2% last month as back-to-school promotions did little to assist retailers.

Paul Martin, UK retail partner at KPMG, said the results were "incredibly disappointing" and noted that efforts were being focused on preservation, not growth, in this adverse and uncertain climate.

Meanwhile, the head of the BRC called on the government to step in and help brick and mortar retailers as the 3.0% like-for-like decline in in-store non-food sales further highlighted the challenges these businesses are facing.

Helen Dickinson, chief executive of the BRC, said: "Summer discounting and poor footfall have hit in-store sales particularly hard. If the Government wants to avoid seeing further store closures and job losses on the UK high street, they must take action. Last month, fifty retail CEOs wrote to the Chancellor demanding he fix the broken business rates system, allowing businesses to fund vital investment during this unprecedented period of transformation."

High-profile businesses that fell afoul of the difficult high street trading environment included Debenhams, HMV, House of Fraser and Poundworld.

Commenting on Tuesday's data, analysts from Shore Capital said: "Our expectation remains that there will be no significant change in consumer sentiment until there is more certainty about the UK’s exit from the EU, therefore we do not anticipate any great upside in both consumer confidence and retail sales until at least the end of September when hopefully further news will appear."