‘In May 2018, consumer spending got a boost from the unseasonal sunny weather and the lift to the national mood ahead of the Royal Wedding. This May couldn’t have been more different with the grim weather being matched only by the grim reality of empty high streets and constrained budgets.
‘While there was a slight bounce in consumer spending in March once the threat of an imminent no deal had lifted, this seems to have been short-lived. The quantity of goods bought in May decreased by 0.5 per cent versus the previous month, with a significant drop in clothing sales of 4.5 per cent. Today's numbers also point to the influence of cheap fast fashion as people are tending to buy more goods at a lower price than before.
‘We are also seeing a continued decline in department store sales which fell 2.4 per cent versus the same month last year. The only bright spots were in grocery sales which held up well, and online shopping which now accounts for 19.3 per cent of total retail sales.
‘Innovations in online shopping such as personal drop boxes are helping to improve the security of online deliveries, while new delivery options allowing people to try on and return products as soon as they are delivered are providing greater flexibility to the online shopping experience.
‘Meanwhile, the struggles on the high street continue. The acceptance of Arcadia’s recent CVA provides conclusive evidence that the economics on the high street have changed for the long term, if not permanently. Commercial landlords with high volumes of retail units have been hit as a result, and they can expect further pain to come.’