Rising food prices drive sales growth in November

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Total food sales increased by 4% during the three months to November on the back of rising prices, according to the latest BRC–KPMG sales monitor.

Over the three-month period total food sales were at their highest 12-month average since March 2013, while like-for-like sales rose by 2.3%.

Overall UK retail sales grew by 0.6% in November compared to the previous year, with much of the growth driven by food sales. Non-food retail sales decreased by 1.2% on a like-for-like basis, below the 12-month total average of 0%.

The online sales penetration rate increased from 26.3% in October 2016 to 27.4% in October 2017, the highest on record. 

British Retail Consortium chief executive Helen Dickinson said: “November brought relief as growth in retail sales perked up after last month’s dip. Black Friday, the big retail event of the month, failed to fundamentally shift underlying trends in spending. Food sales were responsible for pretty much all the growth this month as higher prices continue to absorb more of the weekly shopping budget. Non-food sales - the focus of Black Friday – fell, as the squeeze on household incomes continues to impact discretionary spend.”

IGD chief executive Joanne Denney-Finch added: “This reporting period, spanning from Halloween to Black Friday, is increasingly vital for retailers in its own right and not just as the precursor for Christmas. Grocery retailers will therefore be pleased that the robust sales trend continued throughout November.

“It has been a good year so far for grocery sales, although the final verdict hinges on the four weeks still to come. Christmas shopping could be a bit more spontaneous this year given that 60 per cent of shoppers say they usually end up buying unplanned products at this time, up from 53%  in 2016.”

Readers' comments (1)

  • Strange it may sound, I am pleased that some inflation has crept in to the convenience sector after years of deflation which has decimated our cash margin whilst cost of running our businesses has been escalating in an upward spiral with utilities, not to mention the dreaded government legislation on minimum wage.
    We have somehow become busy fools, often “flogging” everything for a pound and milk and alcohol cheaper than water is a classic example of having deflationary impact on our cash margin. In an ultra-competitive market we need to make sure that our margins are improved by way of introducing more chill, food to go and quality fruit & veg. We cannot just improve sales out of thin air however good an operator you are. Margin enhancement is the only salvation. That doesn’t mean you can just jack up prices but changing our model to more fresh & chill is where the market is and that’s what people are coming into our store for now. Ambient grocery has continued to decline and probably continue that trend in the New Year. There is sufficient data to prove that that’s the case. It’s not all bad news as the recent consolidation in the market place which I very much welcome will offer us more comparative wholesale price and of course the quality on fresh that was very much lacking in the “old” symbol sector.

    Arjan Mehr Londis Bracknell

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