PwC comments on August 2020 ONS retail sales figures

Commenting on the Office of National Statistics retail sales figures for August 2020

Lisa Hooker, consumer markets leader at PwC, said:

“After the stellar recovery in retail sales we saw in the past three months, it’s no surprise that the monthly rate of growth slowed to just +0.7% in August 2020. Being the second month of the high street reopening in full, much of the focus last month was on the hospitality and leisure sectors. The popularity of initiatives such as Eat Out To Help Out even lead to a rare slowdown in grocery sales growth.

However, on a year-on-year basis, retail sales grew by +4.4% excluding fuel. Digging deeper into the ONS numbers, the retail and wholesale trade has recovered quicker than every other part of the economy, except the public sector.

But, as our analysis shows, not every category of spending has shared in this recovery. As we spend more of our working and leisure time at home, it’s little surprise that household goods retailers, such as DIY, furniture and electrical appliance stores, are trading almost 10% ahead of pre-pandemic levels. Yet, despite the rush for back-to-school and children’s clothing, fashion still remains 15% behind February levels.

So, while there is strong evidence of a welcome V-shaped recovery in the retail sector, it’s clear that the headline figures hide mixed performance under the surface. As we approach the run up to Christmas - during which the lion’s share of profits are normally made  - retailers will be hoping that the fragile recovery is not derailed by more widespread lockdowns, rising unemployment or dented consumer confidence.”



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