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Springtime bounceback lifts High Streets to record growth

The Trade Book 89 Jul 12

Retail sales enjoyed a springtime bounceback, with growth in High Street sales from April to June making it the best three months on record, industry body figures indicate.

June's sunny weather and the Euro 2020 tournament helped to boost trade, the British Retail Consortium said.

Sales were up 28.4% from a year earlier and were 10.4% higher than in 2019.

But the BRC warned that many retailers still faced "strong headwinds" as the UK economy recovers from the pandemic.

In June, fashion and footwear did well during the brief burst of sunshine, while the start of the Euro 2020 football championship provided a boost for TVs, snack food and beer.

However, online sales remained much higher than their pre-pandemic levels, suggesting the shift to online was "here to stay", the BRC-KPMG retail sales report found.

There were also signs of a dilution in retail consumer spending as the hospitality and leisure sectors reopened, leading to a "fight for share of wallet", it said.

"Retailers are facing challenges on a number of fronts, particularly convincing consumers that it's safe to shop in store as restrictions around mask wearing and social distancing come to an end," said Paul Martin, UK head of retail at KPMG.

But he added that High Street retailers were hoping for a "summer boost" with the lifting of Covid restrictions.

BRC chief executive Helen Dickinson said: "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.

"In June, while growth in food sales began 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, with strong growth in-store in June."

image copyrightGetty Images
image captionFashion and footwear enjoyed a sales surge, said the BRC

Ms Dickinson said "consumer comfort with the next stage of the roadmap" would be key.

Many customers were looking forward to a return to a more normal shopping experience, while others might be discouraged by changes in face-covering rules, she added.

She said the government would need to reassure the public on safety, while pushing forward with its "hugely successful" vaccination programme.

"The public will also need to be understanding of one another during the easing of restrictions," she warned.

"There has been a big rise in violence and abuse against retail workers during the pandemic and colleagues cannot be put in the firing line because of this change in policy."

New data from Barclaycard indicates that consumer spending rose 11.1% in June compared with the same period in 2019, as warmer weather and the easing of pandemic restrictions led to an economic uplift.

Barclaycard said spending on fuel, hotels, resorts and accommodation all grew for the first time since the pandemic began, as holidaymakers booked and embarked on UK breaks.

Face-to-face retail grew 9.7%, the credit card firm said. However, there were signs that pent-up demand was easing off, as clothing and furniture stores recorded smaller increases than in May.