UK retail sales in March hit record low

UK retail sales in March hit record lows as sakes volumes dropped by 5.1% according to the latest Office for National Statistics (ONS) data. 

UK retail sales in March hit record low

The drop marks the largest fall since the series began as many stores ceased trading from March 23 following official government guidance during the coronavirus pandemic.

In March, clothing store sales saw a sharp fall when compared with the previous month, at negative 34.8%. Whilst food stores and non-store retailing were the only sectors to show growth in the monthly volume series in March 2020, with food stores seeing the strongest growth on record, at 10.4%.

In the three months to March 2020, retail sales volume fell by 1.6% when compared with the previous three months, with strong declines in non-food stores and fuel.

Online sales as a proportion of all retailing reached a record high of 22.3% in March 2020 as consumers switched to online purchasing following the pandemic.

Euan Murray, relationship director, Barclays Corporate Banking, Scotland, said: “March was a watershed month for UK retail. As the lockdown came into full effect and many high street businesses closed their doors to customers, sales were down across the board – with the second half of March showing a particularly sharp drop.

“Although the headline figures were expected, there have been some glimmers of hope amongst the shutdown, with spend on food and drink a notable (if not unexpected) area of success. Whilst most ‘bricks and mortar’ retailers have seen walk-in demand disappear, early indications are that online spending has also performed better than predicted – showing that consumer spend has not closed down entirely.”

Dr. Kerstin Braun, president of Stenn Group, a global trade finance provider, commented: “Retail shops were already suffering before the coronavirus as a result of changing consumer behaviour. Increasing numbers of people are turning away from the high street and shopping online, which offers greater convenience and ease. The COVID-19 pandemic has only escalated the decline of the high street and is likely to speed up these inevitable shifts, with high street footfall seeing its steepest decreases ever.

“Due to restrictions and reduced incomes people will be buying less, and further administration filings are inevitable. SMEs, which make up 35% of retail sales, will be hit the hardest and we know that recovery will not be easy.

“Lenders have been traditionally reluctant to provide loans to shops however rent support programmes, similar to those for furloughed staff, could help to stem the damage and control the effects.

“Fortunately, we will soon see a slow reopening and some return to normality. This will undoubtedly come with new social distancing behaviours that we have already been practising and feel like second nature to us now. Life may not go back to as it was before but even this will be a welcome change.”

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