Pace of growth on high street picks up - CBI survey
Retailers at their most optimistic since 2002
Retail sales grew strongly in the year to August with the pace of growth expected to accelerate again in the month ahead, according to the CBI’s latest quarterly Distributive Trades Survey.
The survey of 142 firms also showed that sales were broadly average for the time of year with retailers more optimistic about their business situation for the next quarter than at any time since May 2002.
Sales volumes rose particularly strongly among grocers, chemists and furniture & carpet retailers, but specialist food & drink retailers recorded a fall in sales volumes. Orders placed with suppliers picked up which had been anticipated by firms, and numbers employed also grew in line with expectations, at the fastest pace since November 2013.
Growth in internet sales volumes also picked up in the year to August, and is expected to strengthen further next month.
Katja Hall, CBI Deputy Director-General, said:
“The high streets have been bustling with shoppers this summer and it is good to see firms so optimistic about their business prospects for the next three months - higher than at any time since 2002.
“Retailers looking forward to stronger growth in September are keeping their shelves well-stocked in anticipation.”
Both wholesalers and motor trades also saw strong rises in sales and employment on a year ago, but the pace of growth in motor trades was slower than in recent surveys.
- 51% of respondents reported that sales volumes were up on a year ago, while 14% said they were down, giving a balance of +37%, matching expectations (+36%)
- Retailers expect sales volumes to grow at an even more robust pace next month (+42%), with 49% expecting them to rise and 7% to fall
- There was a broad-based increase in sales across many sub-sectors with grocers (+60%), chemists (+66%) and furniture & carpets (+63%). Specialist food and drink saw sales fall on a year ago (-34%)
- Retailers expect their overall business situation to improve over the next three months (+25%), the highest figure since May 2002 (+33%).
- 19% of retailers said that sales volumes were above average for the time of year, while 20% said they were below average, giving a balance of -1%
- Stocks remained more than adequate relative to expected demand (+23%), and are expected to remain more than sufficient in September (+24%)
- 28% placed more orders with suppliers than they did a year ago and 19% placed fewer, with the resulting rounded balance of +10% close to expectations (+13%)
- The volume of internet sales rose strongly (+47%) and is expected to grow at an even faster pace next month (+62%)
- Employment grew on a year ago (+12%), rising at the fastest rate since November 2013 (+20%).
- Investment intentions for the year ahead strengthened with a balance of +14%.
63% of wholesalers reported sales volumes to be up on last year and 13% said they were down, giving a balance of +50%, the highest since December 2012 (+53%). Headcount rose at its fastest (+33%) since November 2006 (+50%).
49% of motor traders reported sales volumes to be up on last year and 0% said they were down. Motor traders believe their business situation will improve in the next quarter (+12%), although to a lesser extent than in recent quarterly surveys.
Notes to editors:
1. Firms responding to the Distributive Trades Survey (DTS) are responsible for a third of employment in retailing. The survey includes measures of sales activity across the distributive trades. It was first introduced in 1983 and the retail results form the UK component of the EC survey of retail trades.
2. The survey was conducted between 24th July and 13th of August. 142 firms took part, of which 68 were retailers, 63 were wholesalers and 11 motor traders.
3. A balance is the difference between the percentage of retailers reporting an increase and those reporting a decrease.