Retail Sales were up in July, compared to prior year. It was the first increase, year on year, since the January start to the year. Mike Ashley's Fraser Group suggested there was some "semblance of normality" returning to the high street.
Household goods stores were up by almost 10%. White goods and DIY were beneficiaries. Furniture and floor coverings prospered from the housing market recovery. Garden centres once again featured, with sales up by 12%.
Things must be getting better or people are returning to work. Alcohol sales have fallen for the first time since the start of the year. Clothing and footwear sales were down by 25%. Cosmetic sales were down by over 11%. Overall retail values increased by 3.7% (excluding auto fuels) and volumes increased by just over 3%.
The online story continues. Year on year growth was 53%, accounting for 29% of all retail transactions. Food penetration has doubled over the past twelve months to 11%. Non food sales increased by 60% accounting for 30% of all volume.
Clothing sales online increased by 22%. In store sales were down by 45% year on year. The online mantra is UX and UJ, the quality of user experience and journey. "One Click" the standard. No wonder sales are down in clothing and cosmetics. There is little or no chance to "experience" the product.
The in store retail experience begins with a lengthy queue, confronted by a gatekeeper, with a face shield, pointing a gun at your head, mumbling through a face mask, with no semblance of a smiley welcome. Next will come the sniffer dog, detecting those with a temperature and a hint of a cough, trained to bark aggressively, at those failing to wear a mask.
The rise in retail sales suggests the recovery is gathering pace. The latest IHS Markit/CIPS data points to a further increase in output in August. The composite index increased to over 60 in the month. This was the highest rate of business expansion for almost seven years. Manufacturing and services were beneficiaries as businesses opened up. Manufacturing production increased at a slightly faster pace than services as both sectors experienced a recovery in demand.
Yes the recovery is gathering pace, the recovery will be V shaped but then it always is ...
The Saturday Economist
John Ashcroft publishes the Saturday Economist. Join the mailing list for updates on the UK and World Economy.
|The Saturday Economist|
The material is based upon information which we consider to be reliable but we do not represent that it is accurate or complete and it should not be relied upon as such. We accept no liability for errors, or omissions of opinion or fact. In particular, no reliance should be placed on the comments on trends in financial markets. The presentation should not be construed as the giving of investment advice.