RSM comments on ONS retail sales figures for November

Commenting on today's retail sales statistics for November 2018 released by the Office of National Statistics, Andrew Westbrook, head of retail at audit, tax and consulting firm RSM said: 

'Retailers rely on the final 'golden quarter' to boost their annual revenues and profits – and in some cases to ensure their survival. Given some of the recent warnings, we were expecting today's figures to be bleak. In fact, they were slightly better than we'd anticipated, with retailers reporting a 5 per cent year on year rise in the amount spent by shoppers, reflecting the impact of Black Friday promotions. 

'Online Black Friday promotions helped push up online sales as a proportion of overall retailing to their highest ever level. In November, online sales accounted for 21 per cent of all retailing spend, breaking the 20 per cent barrier for the first time. However, the rate of growth in Black Friday sales overall appears to have slowed slightly this year.

'Today's headline figures mask a disappointing performance from clothing and footwear stores, where the month on month growth in spending was very subdued – up just 0.3 per cent. By contrast, spending on household goods such as homeware, jewellery and leisure goods was slightly healthier rising 1.1 per cent. 

'Looking ahead, there continue to be clouds on the horizon. With fewer than 100 days to go before Brexit, and with the Government having triggered their no-deal contingency plans, consumer sentiment could be hit. On the upside, petrol prices are falling and wage growth is now tracking one percentage point higher than price inflation. As a result, consumers may have a little more disposable income to play with. Whether this will translate into higher spending remains to be seen.

'With some retailers experiencing softer than hoped for November sales, many will now be discounting heavily in order to convert stock into sales to ensure their survival going into 2019.'