Growth in retail sales volumes slowed in the year to April but is forecast to pick up again next month, according to the latest CBI Distributive Trades Survey.
The survey of 122 firms also showed that orders fell in the year to April but they are predicted to rise strongly next month – with expectations highest since May 2014.
Most retail sub-sectors reported rising sales volumes, although overall growth was held back by a fall in the grocers’ sector. Footwear & leather and non-specialised stores also reported lower sales volumes. In contrast,clothing, furniture & carpets, other normal goods and chemists all reported solid sales growth. The rise in internet sales exceeded expectations in the year to April, and strong growth looks set to continue in May.
Meanwhile, growth in wholesale sales volumes accelerated in the year to April, exceeding expectations, but it is expected to slow in May. Motoring sales continued to grow, albeit at a more modest rate than the previous month.
Barry Williams, CBI DTS chairman and Asda’s chief customer officer, said: “With the mixed news we’ve been seeing from the high street recently it’s perhaps not surprising that retailers have reported varied fortunes this month.
“A healthier picture in furnishing and DIY sectors – driven by the desire by customers to spruce up their homes – contrasts with a fall in sales at shoe shops, grocers and department stores.
“With shopping habits changing so dramatically in the last few years underlying consumer confidence is hard to read, but both retailers and wholesalers are optimistic there will be a spring in their customers’ steps, and therefore their sales, in the near future.”
- 30% of respondents said volumes were up on a year ago, and 18% said they were down, giving a balance of +12%, a slight slowing in sales growth on the previous month (+18%) and below expectations (+21%).
- Retailers expect sales growth to accelerate noticeably next month, with a balance of +40%.
- The volume of sales for the time of year in April was considered to be broadly average, with 15% saying that they were good for the time of year and 16% saying they were poor, giving a balance of -1%.
- Hardware and DIY retailers reported the strongest sales growth (+61%) since November 2013, and other sub-sectors also demonstrated brisk growth, such as chemists (+64%) and clothing (+58%).
- Grocers’ sales dipped, with 0% saying that they were up and 25% saying they were down, giving a balance of -25%.
- Growth in internet sales rose ahead of expectations (+55%), with 65% saying they were up and 10% they were down.
- Orders placed on suppliers fell (-8%), with 16% saying they were up and 24% saying they were down. But orders are expected to grow solidly next month (+22).
- Stocks relative to expected demand were at their lowest since February 2014 (+12%), but stock adequacy is set to improve slightly next month.
- 52% of wholesalers reported sales volumes were up on last year and 7% said they were down, giving a balance of +45%. Expectations for growth in the year to May (+24%) are the lowest since May last year (+11).
- 51% of motor traders reported sales volumes to be up on last year and 43% said they were down, giving a balance of 8%.