Arrival of customary "pre-festive" deals boosted food sales though overall sales suffered in October as cash-strapped shoppers stayed at home, holding off purchases amid uncertainty over the budget and fears over rising energy bills.
According to data from the British Retail Consortium and the consultancy KPMG published today (5), sales increased by 0.6 per cent compared with October 2023, less than half the three-month average growth rate of 1.3 per cent.
Food sales increased 2.9 per cent year on year over the three months to October, against a growth of 7.9 per cent in October 2023. This is below the 12-month average growth of 4.1 per cent. For the month of Oct, food was in growth year-on-year.
Helen Dickinson OBE, Chief Executive of the British Retail Consortium, said that October’s "disappointing" sales growth was partly driven by half term falling a week later this yea.
"Uncertainty during the run-up to the Budget, coupled with rising energy bills, also spooked some consumers. Fashion sales took the biggest hit as the mild weather delayed winter purchases. Health and beauty sales remained buoyant, with beauty advent calendars flying off the shelves.
“After a painful Budget for retailers, the hope is it will be less painful for households in the immediate term and consumer appetite will pick up in time for the Black Friday sales and festive season. Retailers must now grapple with over £5bn of new costs announced by the Chancellor, including in Employer National Insurance, Business Rates and the uplift in the National Living Wage. Managing this will hold back investment and growth in the short term, while further squeezing already-low margins and risking inflation," she said.
Commenting on sales performance of food and drink sector performance, Sarah Bradbury, CEO at IGD, said,“In October, UK food and grocery sales saw a modest step up in growth compared to September, but this period does not include the last five days of the month, when an uptick of spending around Halloween might have been expected.
“However, the arrival of customary ‘pre-festive’ deals in categories such as wine helped boost sales in the second half of the month. Importantly - volume, as well as value growth, remained positive despite a downbeat mood in the wider economy reflecting nervousness around potential tax hikes in the government’s budget.
“Shopper Confidence continues to reflect very differing shopper experiences, with lower income households feeling much more negative than higher income households. Retailers will be hoping that measures announced in the budget, such as the uplift in the minimum wage, will give a much-needed confidence boost to lower income shoppers and that the nation is looking forward to the coming festive period with more optimism.”
October’s footfall figures declined marginally as compared to last year, shows latest industry data, highlighting concerns for a policy environment that supports growth and investment.
According to data by British Retail Consortium (BRC), total UK footfall decreased by 1.1 per cent in October (YoY), down from +3.3 per cent in September. High Street footfall decreased by 3.6 per cent in October (YoY), down from +0.9 per cent in September.
Retail Park footfall increased by 4.8 per cent in October (YoY), down from +7.3 per cent in September. Shopping Centre footfall decreased by 1.6 per cent in October (YoY), down from +2.3 per cent in September.
Meanwhile, footfall increased year-on-year in three of the devolved nations, with Northern Ireland rising by 1.3 per cent, Scotland by 0.8 per cent, and Wales by 0.4 per cent, while England experienced a decline of 1.5 per cent.
Commenting on the figures, Helen Dickinson, Chief Executive of the British Retail Consortium, said, "October’s footfall figures showed a marginal decline compared to last year, primarily due to half-term moving out of the comparison. Despite the decline, retail parks continued to attract shoppers, as they saw positive footfall growth for the third consecutive month. Across England, the northern towns performed best, with Leeds and Liverpool seeing positive footfall last month.
"Retailers have seen footfall consistently fall since the pandemic. Thriving high streets and town centres are not only good for local economies but also form a key part of the social fabric of communities up and down the country. With 6,000 stores closing in the past five years, retailers now need a policy environment that supports growth and investment.”
Andy Sumpter, Retail Consultant EMEA for Sensormatic, commented, "After the positive footfall performance we saw in September, October’s footfall dropped back into negative figures compared to the year before. While this will be disappointing for many retailers, who may have hoped the positive figures in September would spell the start of a more consistent uptick in store traffic, it perhaps shouldn’t come as a surprise.
"We expect to see a bumpy recovery as a myriad of market conditions - from the cost of living to shaky consumer confidence around the Budget – continue to make footfall performance volatile. Retailers now need to look ahead and focus their efforts on the rest of the Golden Quarter, delivering compelling reasons to visit in order to drive ambient footfall and sales during the key Christmas trading period.”
The latest findings highlighted by Lumina Intelligence Convenience Tracking Programme reveal a shift towards lighter shopping trips, the impact of weather on daytime meal occasions, and strategic growth in forecourt impulse purchases driven by expanded meal deal offerings.
The Convenience Tracking Programme has uncovered significant shifts in the UK's convenience shopping landscape, indicating a continued rise in market penetration with a notable trend towards "lighter" shopping. The number of shoppers in the market has grown, with an impressive +2.8 percentage point increase in year-on-year penetration. Managed convenience channels are driving much of this growth, reflecting heightened consumer interest in convenience store options.
However, while more shoppers are making trips to convenience outlets, they are increasingly favouring lighter shopping trips. The data indicates a -10 per cent decrease in items per trip, paired with a modest -0.4 per cent decline in total spend per visit. This shift suggests a consumer preference for smaller, more frequent purchases as opposed to larger basket sizes, with customers prioritising efficiency and value.
The data also revealed an increase in share for daytime meal occasions, rising by +0.8 percentage points. This shift is partly due to a rebalancing in food-to-go purchases, which peaked last year during an extended period of favourable weather. This year’s comparatively poorer weather has driven shoppers to consume more meals at home, leading to a greater focus on in-home meal preparation. Consumers are purchasing ingredients and essentials to make meals at home, highlighting a sustained demand for convenient meal solutions that align with at-home dining.
In an otherwise stabilised market, forecourts have emerged as a unique growth channel for impulse purchases, registering a +1.3 percentage point increase year-on-year. Meal deals have been a pivotal driver of this growth, up +4.1ppts as a reason for purchasing on impulse. Leading forecourt operators, including BP and Shell, have expanded meal deal offerings in partnership with established retailers, delivering enhanced value and variety to time-pressed consumers. This strategic move addresses the evolving needs of busy shoppers, who are seeking quick, affordable meal solutions.
An exclusive look at the challenges and opportunities for retail businesses, as revealed in the Future of the High Street report the Federation of Small Businesses.
Supporting pop-ups for new businesses, creating mobile phone-based loyalty programmes and helping bricks and mortar businesses improve their online presence are some of the recommendations set out to revive the UK’s villages, towns and city centres, in a major new report by the Federation of Small Businesses (FSB).
The Future of the High Street report builds up a picture of small firms in and around the high street, including the retail sector, and sets out a vision to help transform high streets into places that meet future needs and support the next generation of entrepreneurs.
The report revealed that the biggest risks for local high streets, according to the retail businesses based on them, were falling consumer spending (74%), rising online shopping and delivery services (55%), plummeting footfall (53%) and crime or anti-social behaviour (48%).
Almost two thirds (63%) of local retail and wholesale small businesses say a diverse range of independent businesses is one of the most important factors for the future of their local high street.
Tina McKenzie
Tina McKenzie, policy chair at the FSB, notes that these businesses also need to be “well equipped” for the future.
“The retail and wholesale sector has been hard hit in recent years, with pressure from the cost-of-living crisis, as well as increasing energy and supply costs and the tightening of consumer purse strings,” she says.
“On top of this there’s been seismic changes on the retail scene in recent decades, with the growth of chain stores, the introduction of out-of-town retail and the arrival of the internet all making their mark. Our high streets continue to evolve and that’s why it’s so important that small businesses at their heart are well equipped for the future.”
The report, which features in depth analysis following a large-scale survey of small businesses, suggests a specialised fund to support mobile phone-based loyalty programmes for high street firms and launching community-specific online marketplaces to showcase local shops and services.
Loyalty schemes tailored to local retailers and communities can encourage repeat visits, higher spending, and a stronger sense of connection between shoppers and their high street. The research found that some sectors on the high street are more likely to offer and make use of these loyalty schemes such as food and beverage businesses (36%) and retail (22%).
The business group’s report is also calling for local authorities to finance support for pop-ups, markets, and temporary use initiatives for first-time businesses to encourage new ventures and help them set up on the high street. This could benefit business owners who are already utilising the benefits of social media to create businesses and interact with customers, but who want a physical presence on the high street.
(Photo: FSB)
Sheri-Ann Bhim started her online business during the Covid-19 pandemic, creating and selling greetings cards and gifts online. Currently selling online from her home in London allows her time to engage with her customer base across the country and develop her products.
The entrepreneur has considered expanding into a retail store that would provide her with storage space but is put off by the challenges that come alongside a physical shop, like “business rates and other overheads”.
“The high street seems so volatile in comparison to online. Yes, online sales can go up or down, but you don’t have as much investment or overheads in comparison to being on the high street,” Bhim says.
“It would be great to have more use of flexible space on the high street. I would love to have a pop-up shop from February to June, so from Valentine’s Day to Father’s Day and maybe two months ahead of Christmas as they’re busy periods for card sales. In the summer when my business isn’t so busy another small independent retailer could take over.”
The future of the high street “needs to be flexible” she adds. “It won’t be the same bricks and mortar businesses that have been there for 200 years, it will have a range of businesses that change with the season. We need to move away from long leases - flexibility is key.”
The integration of physical high street presence with online commerce is vital for the survival and growth of small businesses. With 39 per cent of local businesses selling to their customers via their own website it’s important that high streets remain competitive and appealing to consumers via their online presence.
Abdul Arain
Abdul Arain, owner of Al-Amin grocery store in Cambridge, emphasises the importance of small independent firms being helped to showcase their businesses online.
“Traditionally we have shops on the high street that are independent, then you have [stores like] Tesco Express and Sainsburys, which have a much stronger corporate identity and are more visible. If they want high streets to have a variety of businesses, something needs to be done to allow local businesses to be recognised for what they are offering. That would be powerful and could have large gains for small businesses,” he says.
FSB’s report suggests support could range from basic online marketing and advertising strategies, to utilising online platforms for retail only businesses. To help bridge the gap between more traditional retail and digital marketplaces, a fund could be introduced to support businesses develop their own websites and e-commerce operations.
“As well as core recommendations targeting fundamental issues for small firms on the high street, including business rates, transport and parking, this report also lays out innovative asks to ensure these businesses can survive into the future and ultimately help revive our town centres,” McKenzie says.
“High streets must be helped to evolve to changes in consumer behaviour as well as how small firms want to work. Introducing loyalty schemes should encourage local businesses to collaborate and incentivise consumers to shop, eat, and drink locally.
“We heard from many online small firms who want to take steps to open up in a bricks and mortar premises on the high street and this is exciting to hear. These businesses need support to make that change – and should be given the flexibility to access pop-up and temporary units.”
According to the report’s other findings, empty units are a major blight on shopping streets across the UK, with more than two thirds (69%) of local businesses reporting them on their nearby high street. FSB is asking for a band of on-site high street chiefs responsible for the growth and wellbeing of high streets across the country, creating promotion plans and monitoring vacant units within their area.
(Photo: FSB)
The research also highlights the need for well-maintained and accessible modern public toilets and family-friendly services like creche facilities, encouraging visitors to stay longer, upping footfall and supporting the local economy.
Business rates remain a huge burden on high street small businesses, with the current Small Business Rate Relief (SBRR) a key part of their survival. Half (50%) of local retail and wholesale small businesses say they would not survive without SBRR. With more than half (54%) of high street small businesses claiming they would invest in or grow their businesses if the SBRR threshold was increased from £12,000 of rateable value to £25,000, FSB believes doing so would be a crucial step in allowing small firms to further foster growth.
The report calls for a high street hop scheme providing free bus fares on key routes during peak shopping days to help increase footfall. Offering free parking on at least two Saturdays and two additional days a month, would bring in more visitors and support local businesses by making high streets more accessible, it adds.
A third (34%) of local retail and wholesale small firms say a reduced ability to accept cash payments in the future would pose one of the biggest risks to their local high street. The report calls for a Banking Hub Setup Fund, paid for by high street banks to cover the cost of setting up a hub on a high street, supporting local economies and ensuring essential financial services remain available to businesses and the community.
“Our small businesses are an integral part of the high street and will be central in leading the transformation of their local economies. By providing the infrastructure, flexibility and digital connectivity that modern businesses demand, high streets will then have the resources available to become resilient, dynamic hubs ready for the future,” McKenzie concludes.
The number of adults in England who report vaping for more than six months has increased substantially from around one in 80 in 2013 to one in 10 in 2023, according to a new study led by UCL researchers.
The study, published in The BMJ, found that much of this increase had occurred since 2021, coinciding with the rapid rise in popularity of disposable vapes, especially among young adults, including those who had never regularly smoked.
It was already established that vaping rates have increased substantially in England since new disposable e-cigarettes became popular in mid-2021, particularly among adolescents and young adults, but it was unclear how far this reflected an increase in experimental use versus long term (more than six months) regular use, the researchers noted.
Little was also known about how the types of products used by long term vapers were changing over time.
To explore this further, researchers drew on data for 179,725 adults taking part in the Smoking Toolkit Study, a nationally representative survey that collects detailed data on vaping among adults in England each month.
Between October 2013 and October 2023, participants were asked about use of a range of nicotine products, depending on their smoking status.
Those who reported vaping for more than six months were considered long-term vapers. Details of vaping frequency (daily or non-daily), main type of device used (disposable, refillable, or pod), age, sex, and occupational social grade were also recorded.
Over the study period, the proportion of adults reporting long-term vaping increased from 1.3 per cent in October 2013 to 10 per cent in October 2023, with a particularly sharp rise from 2021. This included an increase in long-term daily vaping, from 0.6 per cent to 6.7 per cent.
The increase in long term vaping occurred predominantly among current and former smokers, but a recent rise also occurred among those who had never regularly smoked (from less than 0.5 per cent up to March 2021 to 3 per cent by October 2023).
Growth was also more pronounced in young adults (reaching 23 per cent of 18-year-olds v 4.3 per cent of 65-year-olds) including among those who had never regularly smoked (reaching 16 per cent of 18-year-olds v 0.3 per cent of 65-year-olds).
The rate of long-term vaping was higher among men than women between June 2015 and December 2022, but by October 2023 the rates were similar between men and women.
The rate of long-term vaping was also consistently higher among those from less advantaged social grades compared with more advantaged social grades.
The researchers also note that half of long-term vapers now mainly or exclusively use disposable devices.
“Our results show there has been an exceptionally steep rise in the number of young adults vaping for more than six months since new disposable e-cigarettes were introduced to the market. While most long-term vapers have a history of smoking, rates have also increased among those who have never regularly smoked,” lead author Dr Sarah Jackson, of the UCL Institute of Epidemiology & Health Care, said.
“In addition to helping people quit smoking, vaping is probably diverting some people away from ever starting to smoke, which will reduce their exposure to harmful toxicants.
“However, it is likely that a growing number of adults who vape would not have otherwise smoked. For these people, vaping regularly over a sustained period will expose them to more harm than if they had neither smoked nor vaped.”
Senior author Professor Jamie Brown, of the UCL Institute of Epidemiology & Health Care, added: “New vaping policies are needed to curb youth vaping in England but must be balanced to avoid discouraging smokers from using vaping products to quit smoking.
“Policies most likely to achieve this balance may be those focused on retail displays, appealing product design and packaging, product descriptions and cost.
“England has excellent vaping and smoking surveillance and will be able to provide a rapid indication of the extent to which new policies achieve these goals. Future regulations should include a degree of flexibility to allow recalibration as required.”
As the study was observational, no firm conclusions can be drawn about cause and effect, and the authors acknowledged several limitations relating to study design and measures that may have influenced their results.
More cases of spirits such as vodka and whisky than of wine are set to be sold globally, a report from the World Spirits Alliance predicted on Wednesday, as drinking preferences have shifted.
The report, whose predictions came from Oxford Economics and alcohol market research firm IWSR, said 2.67 billion cases of spirits were sold in 2022, almost as many as the 2.8 billion cases of wine sold that year.
"Should current trends in both categories continue, spirits volumes will soon surpass those of wine," it said.
Trends, including a shift towards drinking fewer, more expensive drinks, notably a growing range of cocktails, have seen spirits displace wine.
The wine industry has faced a global supply glut, difficult weather and falling demand, which has hit a 27-year low. Beer companies are also grappling with a shift to spirits in some markets.
By the numbers
Beer accounted for 75.2 per cent of total beverage alcohol volumes in 2022, followed by wine at 10.4 per cent and spirits at 9.9 per cent
In terms of the value of sales in 2022, spirits accounted for 40 per cent of total beverage alcohol sales followed by beer at 38.1 per cent and wine at 17.6 per cent
Indian whisky is set to be the fastest growing spirits category between 2022 and 2027, growing by 50 million cases, with tequila, rum and gin all expected to rise between 10 and 20 million cases. Cognac and armagnac are set to grow the least in the spirits market.
The production and sale of spirits contributed some $730 billion to the global economy in 2022, when activity ranging from farming and manufacturing to shipping and sales in shops, bars and restaurants is included.