BRC-KPMG Retail Sales Monitor - October Slowdown: Waiting for Black Friday?

Waiting for Black Friday?

UK retail sales decreased 0.2% on a like-for-like basis from October 2014, when they were unchanged from the preceding year. On a total basis, sales were up 0.9%, against a 1.4% rise in October 2014. Adjusted for the BRC-Nielsen Shop Price Index deflation, total growth was 2.7%.

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  • Total growth was below the 3-month average of 1.8% and the 12-month average of 1.9%. Retailers reported that the timing of Halloween on a Saturday had a negative impact on shopping that day, while categories popular on Black Friday registered some slowdown in October.
  • Total Food sales grew 0.5% over the three months to October, and 0.3% over the twelve months, which was its best performance since July 2014. On a three-month basis, total Non-Food sales were up 2.9%, almost in line with their twelve-month average of 3.1%.
  • Online sales of Non-Food products in the UK grew 9.2% in October versus a year earlier, when they had grown 15.4%. The Non-Food online penetration rate was 19.1%, up from 18.4% in October 2014
Helen Dickinson, Chief Executive, British Retail Consortium, said: "October was a somewhat disappointing month overall for retailers, with just 0.9 per cent growth, slower than the three and twelve month averages. A number of categories which we’d typically expect to be popular on Black Friday saw a slowdown in October, suggesting that some shoppers may be holding out in the hope of some great deals at the end of November. Furniture had a good month however, likely boosted by higher disposable incomes. Clothing also did well last month, driven by mid-season sales; however this may be to the detriment of retailers’ profit margins. Food sales however remained static in October. The picture is brighter when we look at the three and twelve month averages, both of which continue to improve.

"With the Chancellor due to publish both the Autumn Statement and Spending Review in just a few weeks’ time, the Government has an opportunity to help UK retailers to invest in growth and create new jobs by reducing the disproportionate burden of business rates and keep going with the structural review."

David McCorquodale, Head of Retail, KPMG, said: "October certainly looks to have slowed on the high-street, with many retailers probably feeling more tricked than treated as sales were relatively flat overall. Despite the heat wave last Autumn making for weaker comparables, footwear and fashion sales were affected by milder weather again this year which has continued into November and delayed many consumers from buying coats and boots.

"The grocery market continues its decline in like-for-likes but the trends are improving month by month. However, the star categories in October were furniture and home accessories driven by an increase in promotional activity and the positive impact of half-term.

"Looking ahead, retailers will be keeping a close eye on the Autumn Statement at the end of November in the hopes the Chancellor extends relief on business rates. The tactics around Black Friday will also reveal who has the strength to play yet maintain margin."

Food & Drink sector performance – Joanne Denney-Finch, Chief Executive, IGD, said: "After a couple of months of modest growth, the food and drink year-on-year comparison in October fell back into marginally negative territory. Even Halloween falling on Saturday didn’t deliver a decisive boost and England’s early exit at the Rugby World Cup dented hopes for exceptional alcohol sales.

"Deflation continues to dampen down the figures which is good news for shoppers, even though most view it as a short-term windfall. Our research shows only one in ten shoppers expect food prices to fall again in the coming year. This cautious mood helps explain why the combination of rising incomes and falling prices has triggered only a modest amount of trading up on food and drink so far. However, this could change as we enter the crucial Christmas trading phase."


The BRC-KPMG Retail Sales Monitor measures changes in the actual value (including VAT) of retail sales, excluding automotive fuel. The Monitor measures the value of spending and hence does not adjust for price or VAT changes. If prices are rising, sales volumes will increase by less than sales values. In times of price deflation, sales volumes will increase by more than sales values.

Retailers report the value of their sales for the current period and the equivalent period a year ago. These figures are reported both in total and on a ‘like-for-like’ basis.

Total sales growth is the percentage change in the value of all sales compared to the same period a year earlier. The total sales measure is used to assess market level trends in retail sales. It is a guide to the growth of the whole retail industry, or how much consumers in total are spending in retail – retail spending represents approximately one-third of consumer spending. It is this measure that is often used by economists. Many retailers include distance sales as a component of total sales.

'Like-for-like' sales growth (LFL) is the percentage change in the value of comparable sales compared to the same period a year earlier. It excludes any spending in stores that opened or closed in the intervening year, thus stripping out the effect on sales of changes in floorspace. Many retailers include distance sales as a component of like-for-like comparable sales.

The like-for-like measure is often used by retailers, the city and analysts to assess the performance of individual companies, retail sectors and the industry overall, without the distorting effect of changes in floorspace.

Online (including mail order and phone) sales of non-food are transactions which take place over the internet, or via mail order or phone. Online sales growth is the percentage change in the value of online sales compared to those in the same period a year earlier. It is a guide to the growth of sales made by these non-store channels. It should be noted that online sales are still a small proportion of total UK retail sales. Estimates based on ONS figures show about 10 per cent of total UK retail sales (food and non-food) are achieved via the internet.

The responses provided by retailers within each sales category are weighted* (based on ONS weightings) to reflect the contribution of each category to total retail sales, thus making it representative of UK retail sales as a whole. Because the figures compare sales this month with the comparable period last year, a seasonal adjustment is not made. However, changes in the timing of Bank Holidays and Easter can create distortions, which should be considered in the interpretation of the data.

As well as receiving sales value direct from the retailers in the scheme the BRC-KPMG Retail Sales Monitor also receives food and drink sales value data from the IGD's Market Track Scheme.

In its role as sponsor of the BRC-KPMG Retail Sales Monitor, KPMG is responsible for the aggregation of the retail sales data provided by the retailers on a weekly basis. This data consists of the relevant current week’s sales data and comparative sales figures for the same period in the prior year. The aggregation has been performed by KPMG on data for periods following 2 April 2000 and equivalent prior periods.

The accuracy of the data is entirely the responsibility of the retailers providing it. The sponsorship role has been performed by KPMG since 10 April 2000 and the same for the aggregation of comparative sales figures for the period from 2 April 2000 it is not responsible for the aggregation of any data included in this Monitor relating to any period prior to 2 April 2000.

* The aggregation of data for the weighted ‘online’ figures has been performed by the BRC and KPMG for periods starting 25 November 2012 and equivalent prior year periods. Prior to that date, the online figures in this monitor refer to the unweighted non-food non store indicator, as published in the BRC-KPMG Retail Sales Monitor until July 2013.

The commentary from KPMG is intended to be of general interest to readers but is not advice or a recommendation and should not be relied upon without first taking professional advice. Anyone choosing to rely on it does so at his or her own risk. To the fullest extent permitted by law, KPMG will accept no responsibility or liability in connection with its sponsorship of the Monitor and its aggregation work to any party other than the BRC.

© Copyright British Retail Consortium and KPMG (2014). The contents of this report and those of all ancillary documents and preparatory materials are the sole property of BRC and KPMG and are not to be copied, modified, published, distributed or commercially exploited other than with the express permission of BRC or for the purposes of journalistic comment and review. All rights reserved.

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The November 2015 Monitor, covering the four weeks 1 November – 28 November, will be released at 00.01am Tuesday 8 December 2015.

The data is collected and collated for the BRC by KPMG.

The British Retail Consortium (BRC) is the UK's leading retail trade association. It represents the full range of retailers, large and small, multiples and independents, food and non-food, online and store based.

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