The retail sector has made a promising start to autumn, with the cash tills ringing louder than at this stage in the calendar for the past eight years.
Data from CBI’s latest monthly Distributive Trades Survey reveals that sales and orders grew on the high street at a much stronger rate than had been anticipated in the year to September, with the robust pace of growth expected to continue into October.
Sales volumes were “well-above” the average for the time of year, to the greatest extent since April 2007. Orders placed on suppliers grew at the quickest pace since December 2010 and are expected to strengthen further next month, the CBI said.
Growth was broad-based across retail sectors, with clothing retailers among the big winners. Elsewhere, internet sales volumes slowed slightly in the year to September, but are set to pick up somewhat in October.
Rain Newton-Smith, CBI’s director of economics, said: “As the summer has been drawing to a close, consumers have been out on the high street boosting sales and orders for UK retailers. Low inflation and the recovery in wage growth are helping to stimulate consumer demand, but the slowdown in the global economy and tight margins mean retailers won’t get ahead of themselves as we head into autumn.”
In terms of the numbers, 60% of retailers said that sales volumes were up in September compared with the previous year, while 11% said they were down, giving a balance of +49%, with 35% admitting they had exceeded expectations.
55% of firms anticipate sales volumes increasing in the year to September, with 4% expecting a decrease, giving a balance of +51%.
39% of retailers placed more orders on suppliers than they did a year ago, and 9% placed fewer, giving a balance of +30% (highest since December 2010 – +52%). 44% believes orders will strengthen further next month (+44%).
The CBI speaks on behalf of 190,000 businesses of all sizes and sectors which together employ nearly seven million people, about one third of the private sector-employed workforce in the UK.