December Sees a 3.2% Dip in Retail Sales Volumes
Retail sales experienced their worst performance in nearly three years as volumes fell by 3.2% in December, according to figures released by the Office for National Statistics (ONS). This decline follows a rise of 1.4% the previous month and marks the poorest performance since January 2021, when Covid-19 restrictions were still in place. However, the dip may be attributed to early Christmas shopping during Black Friday sales, which boosted November's figures.
Food Stores and Department Stores Hit the Hardest
Food stores saw their steepest fall since May 2021, with sales performing very poorly due to early Christmas shopping. Department stores also experienced a significant decline, with sales dropping by 7.1%. Additionally, the value of retail items bought went down by 3.6%.
Mixed Fortunes: Majestic Wine Reports Record Sales, while DFS Furniture Slumps
Amidst the gloomy retail sales figures, wine seller Majestic reported record sales in the lead-up to Christmas, providing a glimmer of festive cheer. On the other hand, sofa seller DFS Furniture saw a nine percent drop in sales in 2023, which it attributed to record hot weather in September and early October. However, DFS remains confident in meeting its full-year profit target.
Deliveroo Sees Sales Boosted by Stronger Demand
Delivery service Deliveroo experienced an improvement in sales, thanks to stronger demand among consumers facing financial pressures. Customers' food and delivery fees climbed seven percent to £1.1 billion in the last three months of the year. Deliveroo also expanded its services by launching a non-food section in November.
Will UK Enter a Technical Recession?
The big question remains: Did consumers spend their money elsewhere or not at all? This will be the deciding factor in determining whether the UK has fallen into a technical recession, according to Danni Hewson of AJ Bell.
