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Retail sales hold up in December, but 2022 holds ‘significant head winds’

The British Retail Consortium has reported some festive cheer for UK retail, however it has also warned of ‘significant head winds’ in 2022.

For the five weeks from 28 November 2021 to 1 January 2022, sales on a total basis increased by 2.1% in December. This is against a growth of 1.8% in December 2020.

On a two-year basis, total retail sales grew 4.6% during December compared with the same month in 2019, according to the BRC-KPMG Retail Sales Monitor.

UK retail sales also grew 0.6% on a like for like basis from December 2020, reported The Industry.Fashion.

Looking at non-food retail sales over the three months to December, these increased 4.8% on a total basis and 1.4% on a like for like basis. For the month of December, non-food was in growth year on year.

“Despite the recent Omicron outbreak, retail sales held up through December,” commented Helen Dickinson, chief executive at the British Retail Consortium. “Many people chose to shop online rather than travel to nearby high streets and shopping centres. Loungewear was back in fashion, as many pre-empted the possibility of future restrictions. Meanwhile, the return of work-from-home advice and reduction in Christmas social events, caused formalwear sales to slow.

“In the face of rising case numbers and supply chain issues, people in retail pulled out all the stops to ensure everyone got what they wanted this Christmas.”

Helen continued: “Retailers did well to weather the challenging trade conditions, with retail sales for 2021 up on both the previous year and compared to pre-pandemic levels. Continuing a trend throughout the pandemic towards online shopping, 2021 saw a double digit rise in non-food online sales, a testament to retailers’ huge investments in their online platforms.

“However, retail faces significant head winds in 2022, as consumer spending is held back by rising inflation, increasing energy bills, and April’s National Insurance hike. It will take continued agility and resilience if they are to battle the storm ahead, while also tackling issues from labour shortages to rising transport and logistics costs.”

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