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Non-food sales boosted in January, says BRC

Published: 8 February 2011
UK retail sales rose 2.3% on a like-for-like basis in January, although compared with a much weaker January 2010, when sales fell 0.7% due to bad weather.
Non-food sales boosted in January, says BRC
Pent-up demand after December's snow, pre-VAT rise purchases and clearance bargains boosted non-food sales at the start of January, before consumer caution caused sales to fall back as the month went on.

The latest figures from the BRC-KPMG Retail Sales Monitor showed total sales rose 4.2%, against a 1.2% rise in January last year.

BRC director general Stephen Robertson said: "On the surface, this is the best sales growth since last March, but that's not the whole story. Comparisons are with a feeble, snow-hit performance a year ago. Growth this January was driven by a relatively short but strong burst of non-food buying early in the month... Later in the month sales of non-food goods slowed, particularly for bigger items, as the reality of worries about jobs and personal finances returned to customers' minds."

He added: "Turning around consumer confidence is central to turning around the economy. A range of pressures is bearing down on customers. As it considers the Budget, the Government must not add any more."

In DIY and gardening, clearance and pre-VAT increase purchases helped larger projects at the start of the month. Indoor décor and DIY showed gains, but these were often promotion-led. Gardening showed gains for some, but against a weak, snow-hit January 2010. Indoor plants, bulbs and cut flowers were popular.

In homewares, home accessories and house textiles picked up, showing year-on-year gains after two months of declines. Clearance sales and cold weather boosted bedding, linens and furnishings. Lighting, kitchenware and floorcare did well, but consumer uncertainty continued to favour essentials over discretionary and decorative items.

Sales of furniture and floorcoverings improved to show year-on-year growth for the first time since June, but again, the gain comes against a weak January 2010.

KPMG head of retail Helen Dickinson commented: "The divergence between food and non-food narrowed in January, partly due to the VAT rise, and interestingly it was the sectors that had been struggling over the previous quarter, including furniture, DIY and home-related areas that picked up more strongly than clothing."

Non-food, non-store growth sales growth fell back in January after picking up in November and December. Sales were 12.3% higher than a year ago, less than the 18% rise the month before.

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