As spring emerges, retailers and restaurants in the UK are facing challenging times as consumer spending remains subdued. Reports from the British Retail Consortium (BRC) and KPMG indicate that sales in March and April have shown little growth compared to the same period last year, despite inflationary pressures and unfavorable weather conditions impacting various sectors.
The recent data reveals a 4% decrease in sales during the four-week period ending in April, with non-food sales experiencing a significant 3% dip seen both in physical stores and online. The early Easter timing this year has contributed to the decline, with categories like clothing, footwear, DIY, and garden furniture being particularly affected by the gloomy weather. Retailers have been offering discounts to attract customers, but challenges persist with decreasing footfall at retail destinations, down by over 7% in April.
Barclays' consumer spend report further delves into the shifting spending patterns, showing a preference for travel and leisure activities over non-essential purchases like clothing. Notably, airlines have seen a nearly 10% increase in spending, while clothing sales have dropped by 1.8%. The struggles extend to the restaurant sector as well, with a substantial 12.6% decrease in sales, mirroring the findings from February. This shift in consumer behavior can be attributed to various factors, including last year's housing cost surge, prompting individuals to cut back on discretionary spending.