Retail sales volumes grew at the fastest pace for over a year in the 12 months to November, according to the latest CBI quarterly Distributive Trades Survey.
The survey of 126 firms, of which 61 were retailers, showed that sales volumes for the time of year were considered well above average and are expected to grow at a broadly similar pace in December.
The volume of orders placed upon suppliers inched up for the first time in eight months with a further slight increase expected for the year to December.
The increase in retail sales volumes was driven by the clothing and non-store goods sectors, as well hardware and DIY. Growth in internet sales volumes increased at a healthy pace over the same period, with expectations for growth in the year to December the strongest for two years.
Investment intentions for the year ahead were weaker than last quarter, but remained marginally positive. Average selling prices rose modestly, in line with expectations, with a similar increase expected next quarter. Retailers expect the overall business situation to improve slightly over the next three months.
Rain Newton-Smith, CBI chief economist, said: “It’s great to see retailers reporting such a buoyant month for sales. With the later onset of cold weather, shoppers stocking up their winter wardrobe has helped to boost high street sales.
“While we expect to see decent growth in the near term, retailers are keeping a close eye on price rises coming down the track and the impact on consumer spending.”
- 42% of retailers said that sales volumes were up in November on a year ago, while 16% said they were down, giving a balance of +26%, the strongest survey balance since September 2015. This was marginally above expectations (+21%), and a slight improvement on the previous month’s balance (+21%).
- 39% of respondents expect sales volumes to increase next month, with 16% expecting a decrease, giving a balance of +23%
- 31% of retailers placed more orders with suppliers than they did a year ago, whilst 24% placed fewer orders, giving a rounded balance of +6%, the strongest survey balance since December 2015.
- 29% of businesses reported that their volume of sales for the time of year were good, whilst 5% said they were poor, giving a balance of +24%
- Growth in internet sales volumes rose above its long run average in the year to November (+51%) up from the previous month (+37%)
- Sales volumes grew in clothing (+95%), hardware and DIY (+62%) and non-store goods (+49%) among others. Sales volumes for grocers remained flat (0%)
- Average selling prices rose on a year ago (+14%) and are expected to increase at a similar pace in December.
- Investment intentions remained positive (+4%) for a second quarter running. The business situation was expected to improve further over the next three months (+12% from +7%).
- 51% of wholesalers reported sales volumes to be up on last year, and 10% said they were down, giving a balance of +41%.
- 41% of motor traders reported sales volumes were up on a year ago, whilst 0% said they were down, giving a balance of +41%. Volumes are expected to slow next month (+24%).