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What a difference a year makes. April 2021 was the month window shoppers became buyers again as retailers were free to fling open their doors again and shoppers queued around the block to finally spend, spend, spend.
British retail sales have soared in the past month, according to the latest data released today. Sales volumes in April rose 9.2% from March, with a year-on-year comparison showing a 42.4% surge in sales compared to April 2020 when we were in the first lockdown and the tightest restrictions were in place.
It has been a very long time coming, but this re-opening of the retail sector will be welcome news for the sector and bodes well for the months ahead. Today, in one fell swoop, the “will they, won’t they?” question of whether shoppers would flock back to the UK’s high streets and shopping malls was answered with a resounding ‘yes’.
All retail sectors saw a fall in online sales as physical stores re-opened during the month. Online sales made up 30% of retail sales volumes, down from 34.7% in March.
Non-food shops once again led the rise in sales with shoppers visiting department and clothing stores to revamp their wardrobes and finally change out of their lockdown loungewear. But that was not the only sign of things getting back to ‘normal.
Fuel sales are also on the rise, as the lifting of restrictions allow people to travel more freely throughout the UK. Petrol stations saw a 69.4% jump in sales compared with March. And with staycations looking likely to become de rigeur this summer, it is likely we’ll continue to see sales recover even further over the next few months, as consumers make the most of the travel opportunities inside the UK. That is, as long as reopening stays on track, of course.
From today’s figures there are also immediate, but tentative signs, that the reopening of pubs and restaurants is having a knock-on effect on supermarket sales. Food sales volumes there were down 0.9% in April, after months of growth.
Of course, not every section of the retail sector has struggled during the pandemic. The supermarkets have been quids in as shoppers have nowhere else to fill their trollies for most of the past year. Pet stores have also seen a boom, with an estimated 3 million-plus pets having found themselves new homes in animal-loving UK households during lockdown. Such has been the surge in pandemic puppy pals, in particular, that the Office for National Statistics now includes dog treats in its inflation basket of goods. And that can only be very good news for the likes of Pets at Home Group (PETS), which posts its latest results next Thursday.
Marks & Spencer, once the bellwether of middle England consumer shopping habits, has gone off the rails over the past few years with its hit and miss range of womenswear, but where it has the chance to shine is with its superbly-timed tie-up with online grocer Ocado (OCDO).
Having jumped in the seat that former Ocado-partner Waitrose had vacated to go-it-alone on the online grocery shopping front, M&S found itself in prime position to set itself up as an online grocery champion, just as the pandemic struck and online slots became as valuable as gold-dust. Has that done the trick though? We will find out on Wednesday.
And then there is Ted Baker. The fashion chain dogged by allegations of “forced hugging” which pushed founder and former chief executive Ray Kelvin to leave after 32 years. Remember that? Well you might have thought that would have been the final straw after the company had also struggled financially, with four profit warnings in a year and a £25 million accounting error, which it later said was due to £58 million in overstated stock. But then the pandemic struck of course. Rachel Osborne, the former Debenhams financial chief who took over as Ted Baker chief executive in March, described the pandemic as an “extraordinary” ordeal, but said the company had made good progress on its efforts to bolster online sales and clear stock faster.
So, Ted Baker is still here. Although at the last count it became vividly clear that losses had ballooned during the pandemic. Pre-tax losses almost quadrupled to £86 million in the six months to August on the back of sales which slumped 46% year-on-year to £170 million.
But, Ted Baker did say that online revenues had risen 42% in the period to £74 million, meaning all may not have been lost. Thursday’s update should tell us all we need to know about whether Ted Baker really has turned a corner or not.
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