Retail sales, Great Britain: June 2020

• In June 2020, the volume of retail sales increased by 13.9% when compared with May 2020 as non-food and fuel stores continue their recovery from the sharp falls experienced since the start of the coronavirus (COVID-19) pandemic.

• The two monthly increases in the volume of retail sales in May and June 2020 have brought total sales to a similar level as before the coronavirus pandemic; however, there is a mixed picture in different store types.

• In June, while non-food stores and fuel sales show strong monthly growths in the volume of sales at 45.5% and 21.5% respectively, levels have still not recovered from the sharp falls experienced in March and April.

• Food stores and non-store retailing both reached new high levels since the start of the pandemic, with volume food sales 5.3% higher, and non-store retailing 53.6% higher, than February.

• In the three months to June, the volume of sales decreased by 9.5% when compared with the previous three months, with declines across all store types except food stores and non-store retailing.

• The proportion of online spending reduced to 31.8% in June when compared with the record 33.3% reported in May, but is a considerable increase from the 20.0% reported in February.

Table 1 provides a snapshot of what is happening in the retail sales industry in June 2020 with both value and volume growth rates.

In June, the monthly growth rate increased by 13.6% for value sales and 13.9% for volume sales. This is the second consecutive month of strong growth following record declines in March and April 2020, which has returned the index for volume of total retail sales to similar levels as before the coronavirus (COVID-19) pandemic (Figure 1). When compared with February 2020, volume sales decreased by just 0.6% for total retail.

For total retail excluding fuel, we see an increase in both value and volume measures in June when compared with February, in addition to the same month a year ago.

Looking at the three months to June, when compared with the previous three months, value sales decreased by 11.1% and volume sales by 9.5%. Similarly, three months a year ago also saw declines for both value and volume estimates.

The volume of retail sales showed moderate growth up to the beginning of 2019 and flattened out throughout the year and into 2020.

In mid-March 2020, we saw a sharp decline in total sales as the effects of the coronavirus (COVID-19) pandemic hit stores. This decline continued in April as the first full month where many non-essential stores reduced or paused trade, resulting in the lowest levels experienced since 2005.

In May, we saw some recovery to the falls experienced in March and April as stores began to recover from low levels, but sales were still 12.8% lower than in February 2020, before the pandemic.

In June, total retail sales continued to increase to reach similar levels as before the pandemic, with a fall of just 0.6% when compared with February.

While sales at a total level have recovered in June, not all sectors have behaved in this way as we see a mixed picture for the different store types.

Food stores

We see relatively stable to slow growth in sales from food stores up to March 2020 where there was a peak in spending as growth in volume sales reached a record 9.9% when compared with February.

Feedback from food retailers had suggested that consumers were panic buying in preparation for the impending lockdown. In the first quarterly GDP release, stockpiling was suggested as a reason for increased manufacturing for certain products including food, and commented on the decreased levels of stocks held within the retail wholesale industry, partly because of "consumer increased spending on household goods and food and drink". With bar and restaurant closures, consumers prepared to spend more time in their homes.

Following this peak, sales returned to a level higher than before the pandemic. In June 2020, despite a small monthly decline of 0.1% in volume sales, food stores remained 5.3% higher than in February 2020.

Non-store retailing

Non-store retailing has reached a new high level in June 2020, with continued growth during the pandemic and a 53.6% increase in volume sales when compared with February 2020.

Despite a moderate monthly increase of 1.1% in June, this sector has remained at historically high levels, with the benefit of continued trade for many online stores while social distancing measures were in place. While a number of store types have started trading again in June, consumers are still spending online and retaining the high level of sales. We talk about the historical uptake to online shopping in this article on internet activity.

Fuel

Similar to food and non-store retailing, many fuel stores continued to trade throughout the pandemic, but experienced sharp falls in March and April 2020 because of travel restrictions. From May, as mentioned in the previous month's retail release,  sales started to recover with the easing of government travel restrictions, increasing by a record 47.4%. Continuing this growth in June, fuel sales increased by 21.5% when compared with the previous month, however, sales still remained 30.3% lower than February.

Non-food stores

Non-food stores was one of the hardest hit sectors during the pandemic because of many stores falling under the non-essential store types listed by government. While non-food stores show some recovery with strong growth in May and June 2020, sales have not currently returned to the levels experienced before lockdown.

The strong monthly growth of 45.5% in the volume of sales in June still results in lower than usual levels, showing a partial recovery. When compared with February, non-food stores were at negative 15.0% in volume terms and at negative 15.9% in value terms.

Table 2 provides growth rates for the main stores within the non-food sector for June when compared with February. It also provides growths for total retail, store sales and online-only retailing. Since we do not produce volume estimates for online sales, Table 2 looks at value sales.

While we see an overall decline of 15.9% in the non-food stores sector, not all stores show this negative picture, as we see a recovery in June for household goods stores.

Department stores show the smallest decline with the biggest increase in online sales. Store sales fell by 28.3%, while online sales increased by 111.3%.

Textile, clothing and footwear stores show the sharpest decline in total sales at negative 34.9%. This was because of a combination of a large fall within stores at negative 50.8% along with a slower uptake in online sales, with a 26.8% increase from February.

Household goods stores, as the only store type to show an increase since the start of the pandemic, has a large uptake in online sales, increasing by 103.2%. In addition, household goods stores saw the smallest decline in store sales when compared with other non-food stores, at negative 15.2%.

A closer look at the growth in household goods stores

In June 2020, household goods stores recovered from the falls caused by the coronavirus pandemic, with increased value sales of 1.9% and volume sales of 3.6% when compared with February 2020. All household goods store types, except music and video, made a full recovery from the initial declines (Figure 6).

In June, electrical household appliances, hardware, paints and glass, and furniture stores all returned to similar levels as before the pandemic. We see increased sales in electrical household appliances and hardware stores, with feedback from retailers suggesting that people focused on home improvements during lockdown, which helped boost their sales. We also see furniture stores returning to normal levels. In contrast, music and video remain at lower levels than February, following a general decline in this sector over time.

While government restrictions were in place for non-essential stores from mid-March, this lifted with the government's recent recovery strategy and many stores were able to start trading again in June 2020.

Looking at the results from Wave 7 of the Business Impact of Coronavirus (COVID-19) Survey (BICS), which covered the dates 1 to 14 June, all responding businesses in the fuel sector reported they were currently trading and had been for more than the last two weeks, while other sectors reported a mixture of responses.

We can see from these results that all fuel businesses that responded to Wave 7 of BICS reported currently trading between 1 and 14 June 2020.

Textile, clothing and footwear stores showed the lowest percentage of businesses that were currently trading and had been for more than two weeks between 1 and 14 June at 51.9%, but showed the biggest uptake in trade within the last two weeks after a pause in trading at 37.0%.

Following this, when looking at the results from Wave 8 of BICS (Figure 8), this shows that there has been an increase in the number of textile, clothing and footwear stores who were currently trading and had been for more than the last two weeks between 15 and 28 June at 73.1%.

Please note, BICS is voluntary and currently unweighted, so it may only reflect the characteristics of those who responded.

The Retail Sales Inquiry estimates, which are based on a much larger sample survey, reported that textile, clothing and footwear stores had the largest monthly increase in the volume of sales in June 2020 at 70.2%, which could be explained by the reopening of stores in this sector (Figure 9).

The amount of money spent online has increased at a fast pace since before lockdown, increasing by 61.9% in June 2020 when compared with February 2020. This has resulted in an increase of £943.5 million for average weekly sales from £1.5 billion in February to £2.5 billion in June. This was following a stable period of growth up to February, indicating that consumers had shifted to online spending even more so during store closures.

Looking at spending within the main sectors, there was increased spending across all stores (Figure 11).

While all sectors show a recent uptake in money spent online, non-store retailing has always dominated spending, with more money spent in businesses that predominantly only trade online.

Non-food stores have seen continued strong growth in online spending since the beginning of 2020. Feedback from retailers had suggested that lockdown measures had encouraged them to diversify and trade online during lockdown. Department stores stated that they took advantage of promotional activity during June 2020, further increasing sales.

Food stores has the least amount of online spending throughout, when compared with other main stores, but saw a sharp increase in March 2020 following a continued stable period.

As a proportion of total retailing, the amount of money spent online has reached 31.8% in June (Figure 12).

While we see a slight fall in the proportion of spending from 33.3% in May to 31.8% in June, proportions remain at higher than usual levels. In comparison, the proportion of online sales in February was at 20.0%.

Value (amount spent)

The value estimates reflect the total turnover that businesses have collected over a standard period.

Volume (quantity bought)

The volume estimates are calculated by taking the value estimates and adjusting to remove the impact of price changes.

Seasonally adjusted

Seasonally adjusted estimates are derived by estimating and removing calendar effects (for example Easter moving between March and April) and seasonal effects (for example increased spending in December as a result of Christmas) from the non-seasonally adjusted (NSA) estimates.

Non-seasonally adjusted

Non-seasonally adjusted estimates refer to raw data where the effects of regular or seasonal patterns have not been removed.

Non-store retailing

Non-store retailing refers to retailers that do not have a store presence. While the majority is made up of online retailers, it also includes other retailers such as stalls and markets.

This bulletin presents estimates of the quantity bought (volume) and amount spent (value) in the retail industry for the four-week period 31 May 2020 to 4 July 2020.

Unless otherwise stated, the estimates in this release are seasonally adjusted. Retail sales collects turnover data from retailers, which is money through the till before any deductions, including refunded items. This provides us with the best indicator for consumer spending during the reference period.

The Retail Sales Index (RSI) measures the value and volume of retail sales in Great Britain on a monthly basis. Data are collected from 5,000 businesses in the retail industry, with all businesses employing over 100 people or with an annual turnover of more than £60 million receiving an online questionnaire every month. The survey’s results are used to produce seasonally adjusted monthly, quarterly and annual estimates of output in the retail industry at current price and at chained volume measures (removing the effect of price changes).

Quality

More quality and methodology information on strengths, limitations, appropriate uses, and how the data were created is available in the Retail Sales QMI.

Seasonal adjustment

All seasonal adjustment parameters for our volume and value data, for all businesses and internet time series, up to June 2020 have been reviewed. Many series are impacted by coronavirus (COVID-19)-related actions in June 2020 and previous months. Each series has been reviewed and the best adjustment for coronavirus-related effects applied. These may need to be revised further as additional data become available.

Uses and users

The Retail Sales Index (RSI) is an important economic indicator and one of the earliest short-term measures of economic activity. It is used in the compilation of the national accounts and widely used by private and public sector institutions, particularly by the Bank of England and HM Treasury to assist in informed decision- and policy-making.

Comparability with international data

The most recent international estimate of retail sales available for June 2020 was published by the US Census Bureau on 16 July 2020. In its advanced monthly sales for retail and food services, June 2020 (PDF, 1.96MB) they include the amount spent in the US retail industry, including motor vehicles and parts and food services.

Data for Northern Ireland are published by the Northern Ireland Statistics and Research Agency (NISRA).

It should be noted that accurate comparisons cannot be made against these or other international statistics for a variety of reasons, including differences in methodology.

Eurostat also published their latest estimates of the Volume of retail trade (PDF, 524KB) across the European Union on 6 July 2020 for May 2020. This shows the seasonally adjusted volume of retail trade in both the euro area (EA19) and EU27 when compared with April 2020.

As the UK leaves the EU, it is important that our statistics continue to be of high quality and are internationally comparable. During the transition period, those UK statistics that align with EU practice and rules will continue to do so in the same way as before 31 January 2020.

After the transition period, we will continue to produce our national accounts statistics in line with the UK Statistics Authority's Code of Practice for Statistics and in accordance with internationally agreed statistical guidance and standards.

The Withdrawal Agreement outlines a need for UK gross national income (a fundamental component of the national accounts, which includes gross domestic product (GDP)) statistics to remain in line with those of other EU countries until the EU budgets are finalised for the years in which we were a member. To ensure comparability during this cycle, the national accounts will continue to be produced according to European System of Accounts (ESA) 2010 definitions and standards.