BRC – KPMG online retail sales monitor May 2017 | KPMG | UK

BRC – KPMG online retail sales monitor May 2017

BRC – KPMG online retail sales monitor May 2017

Online sales of Non-Food products in the UK grew 4.3% in May.

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  • Online sales of Non-Food products in the UK grew 4.3% in May compared to 13.7% rise a year earlier. This is the lowest growth since December 2012. 
  • Over the 3 months to May, Online sales of Non-Food products in the UK grew 7.0% year-on-year, the lowest in the BRC series started in December 2012.
  • In May 2017, Online sales represented 22.1% of total Non-Food sales in the UK, against 21.2% in May 2016. On a 3-month basis, penetration rate was 21.9%.
  • Over the 3 months to May, Online sales added 1.3 percentage points to the year-on-year growth of Total Non-Food sales. In contrast, In-Store sales made a negative 3-month contribution of 1.2 percentage points. In May, Online sales
    contributed 0.9 percentage points to Non-Food growth.
  • Over the 3 months to May, In-Store sales fell, posting declines of 1.8% on a total basis and 2.3% on a like-for-like basis. For the month of May, In-Store sales declined by 4.4%, a striking decline, the sharpest decline since the BRC series started in December 2012.

Helen Dickinson OBE, Chief Executive | British Retail Consortium said: 

“The slowdown in overall non-food sales was mirrored online in May as annual growth fell to its lowest on record. Though sales in all categories but one saw growth, this was subdued as consumers held back on non-essential purchases. 

“Where there is willingness to spend on non-food items, this is largely concentrated on value-lines. The clothing and beauty categories in particular were boosted by some late season promotions, which looks promising for those retailers who will be launching their mid-season sales this month.

 

“For the second consecutive month, the increase in the online penetration rate has remained below one percentage point. Retailers will be increasingly looking to innovate and optimise their online channels to convert a greater share of online browsing into sales.”

 

Paul Martin, UK Head of Retail | KPMG said:

 

“Whilst non-food online sales continue to deliver growth, the significant news is that this month’s year-on-year growth is the lowest recorded since our online retail sales monitor began back in December 2012. Broadly speaking, most categories noted a rise, but growth had clearly been muted due to shoppers clawing back on non-food purchases. 

“Bucking the general trend, health and beauty products continue to be the rising star, with holiday season, sunshine and hay fever likely to be fuelling this growth. Elsewhere, the more seasonal weather in the month is likely to be behind fashion sales performing better. 

 

“With such meagre growth in online sales in May, it is vital online retailers master the art of customer-centricity and personalisation. Ensuring the right products are available at the right time, and that surplus stock is not sold at significantly reduced prices, is becoming ever more important.  Success will come from an ability to target the online shoppers who spend more and return less.”

 

 

 -ENDS-

Notes to editors:

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 weightings derived from the ONS Family Spending survey) 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 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. 

For media enquiries:

Zoe Maddison
Media Relations Officer, BRC
Tel:   +44 (0)20 7854 8924
Zoe.maddison@brc.org.uk  

Simon Wilson, KPMG
Tel: 0207 311 6651/ 0778 537 3397
simon.wilson@kpmg.co.uk

Laura Roberts 
Head of Corporate Communications, IGD
Tel:   01923 857141/07811 930971
Laura.Roberts@IGD.com


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

BRC

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.

KPMG

KPMG LLP, a UK limited liability partnership, operates from 22 offices across the UK with approximately 13,500 partners and staff.  The UK firm recorded a revenue of £2.07 billion in the year ended 30 September 2016. KPMG is a global network of professional firms providing Audit, Tax, and Advisory services. It operates in 152 countries and has 189,000 professionals working in member firms around the world. The independent member firms of the KPMG network are affiliated with KPMG International Cooperative ("KPMG International"), a Swiss entity.  Each KPMG firm is a legally distinct and separate entity and describes itself as such.

Food data supplied by IGD makes a difference by providing international market intelligence, supply chain best practice and consumer insight to the food and grocery industry worldwide. We work with consumers, companies and individuals across the chain to provide authoritative information, insight, thought leadership and leading edge best practice to help companies grow their business and develop their people.

Detailed weekly data by category is available to retailers who contribute to the monitor:

If you would like to participate in the Retail Sales Monitor, please contact:

Anne Alexandre 

T: 0207 854 8960

 

E: anne.alexandre@brc.org.uk

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