Cold wet weather and caution about spending amid high interest rates and energy bills have delivered a dismal start to spring for retailers, shows the latest industry figures.
According to the latest figures from the British Retail Consortium (BRC) trade body and advisory firm KPMG released today (7), sales were virtually flat across March and April against the same period a year ago, despite prices continuing to rise with inflation, suggesting a drop in the volume of items sold in the key Easter period.
Food sales increased 4.4 per cent year on year over the three months to April, against a growth of 9.8 per cent in April 2023. This is below the 12-month average growth of 6.7 per cent.
In the four weeks to the end of April, overall retail sales were down 4 per cent, but this number was partly affected by Easter falling early this year at the end of March. Non-food sales were the hardest hit, down almost 3 per cent with in-store and online orders down.
Helen Dickinson OBE, Chief Executive of the British Retail Consortium, said, “Dismal weather and disappointing sales led to a depressing start to Spring for retailers, even accounting for the change in timing of Easter. People delayed typical Spring purchases despite retailers’ attempts to entice customers with heavy discounts. A dull, wet April dampened sales growth for clothing and footwear, especially outdoor sportswear, as well as DIY and garden furniture. Promotions in computing did boost sales as many sought to upgrade their tech a few years post the pandemic surge in tech sales. Many retailers are hoping for brighter sales over the summer months as social events ramp up, and consumer confidence could improve with a potential cut in interest rates.
“A strong retail industry is vital for a strong economy, and it is vital the next Government recognises this if it wants to boost investment in our towns and cities. Retail is nearly 10 per cent of employment in every region and plays a unique role in building communities and generating local economic growth. The Government must champion pro-growth policies to help unlock important investment in many left-behind regions.”
Reacting to food and drink sector performance, Sarah Bradbury, CEO at IGD, said, “With Easter falling in March this year, the UK grocery market was always going to face a tough set of annual comparisons in April. Sales and volumes have predictably both turned negative compared to the same period last year. But there is hope - with inflation continuing to exit the market, increased promotional activity among retailers, and two upcoming bank holidays in which sales and volumes will surely improve.
“As expected, confidence in the year ahead continues to grow steadily. Shopper confidence at a total level increased slightly in April as inflation continued to ease off slowly. However, as National Price Hike Day and the 2p cut to national insurance have both come into effect, we continue to anticipate a divergent experience in recovery for shoppers.”
Leading wholesale buying and marketing group Sugro UK has collaborated with Britvic Soft Drinks, a global organisation with 39 much-loved brands sold in over 100 countries, to launch a groundbreaking Fast Food Sample Box.
The sample box is specifically designed for ICS UK LTD customers, giving them a unique opportunity to sample and experience new Fast Food soft drinks offerings firsthand.
The new Fast Food Sample Box offers ICS customers an exclusive opportunity to explore a curated selection of Britvic's best-selling and new product offerings that drives incremental sales. This trial initiative is designed to provide Fast Food retailers with a hands-on experience of market-leading products, helping them identify key opportunities for growth in the Fast-Food soft drinks categories.
Sugro UK's Fast Food Sample Box represents a pioneering approach to boosting customer engagement, providing tailored solutions that meet the evolving demands of today’s consumers. This initiative is the first of its kind in the sector, giving ICS customers exclusive access to products that are proven to drive sales and offering them a competitive edge in their local markets.
Alice Graham, GB Head of Dining Route to Market Wholesale, "We are delighted to collaborate with both Sugro and ICS with this initiative. The fast-food market has seen double digit growth over the last few years and the growth is set to continue. This initiative with ICS, a leader in fast food wholesale, underscores our commitment to supporting the growth of Britvic brands and advancing our partnerships with fast food establishments.”
Sid Musa, Manager at ICS (UK) added, “At ICS UK LTD, we are thrilled to partner with Sugro UK and Britvic on this industry-first initiative. The Fast-Food Sample Box gives our fast-food customers a unique opportunity to experience top-tier products firsthand, empowering them to make informed decisions that can truly elevate their offerings. We’re confident this exclusive initiative will help our customers stay competitive and drive growth in an ever-evolving market.”
Yulia Petitt, Head of Commercial and Marketing at Sugro UK commented: “We are incredibly excited about the partnership with Britvic delivered with excellence by our member – ICS Ltd. Fast Food sector is a big part of the group commercial strategy, so we see it as a huge opportunity for the group.”
Sugro UK is proudly owned by its 90 plus independent wholesale members, with a combined turnover of over £2.5 billion. The group was recently voted number one across all buying groups in the recent Advantage Group Survey.
British plant-based ready meal maker Allplants has filed a notice of intention to appoint administrators, citing ongoing financial losses, stated recent reports.
Allplants, known as the UK’s largest vegan ready meal brand, has faced mounting losses over recent years. Filing the notice provides the company with a critical window to explore options to avoid liquidation, such as restructuring, refinancing, or negotiating a sale.
According to the founder and CEO Jonathan Petrides, Allplants is working closely with insolvency specialists Interpath Advisory to assess “all possible options for restructuring, refinancing, and ensuring the sustainability of Allplants".
The reports added that while the prospect of a buyer offers some hope, failure to finalise a deal would likely lead to the company’s remaining stock being sold off to pay creditors. The development underscores the challenges faced by plant-based food companies as they navigate a competitive and increasingly crowded market.
Allplants started off as a direct-to-consumer brand in 2016, made its retail debut in November 2022, listing its meals at Planet Organic and several independent stores, as well as online grocer Ocado. It witnessed instant success, selling six million meals within the first three months and becoming the second-most purchased frozen meal brand on the latter platform.
Allplants has raised £67m across several financing rounds from investors including Molten Ventures, Felix Capital, Octopus Ventures, The Craftery, and professional footballers Chris Smalling and Kieran Gibbs.
Allplants’s move to appoint administrators is indicative of the distressed vegan ready meal category in the UK. It was among the categories that have witnessed a drop-off in sales recently, falling by 20 per cent between 2022 and 2023, according to Circana data commissioned by the Good Food Institute, which attributed it to cost-of-living pressures that led shoppers to cut back on non-essential and convenience items.
The country’s largest meat-free company, Quorn, posted pre-tax losses of £63m in 2023, a fourfold increase from the £15m it lost the year before. Meatless Farm and VBites also came close to the brink, before being rescued by VFC (now the Vegan Food Group) and owner Heather Mills, respectively.
Entrepreneur and businessperson Stanley Morrice, an influential figure in the retail and wholesale sectors, received an Honorary Doctorate from the University of Stirling at Stirling’s winter graduation held today (22).
Stanley, from Fraserburgh, is being recognised for his services to Scottish food, drink and agriculture. He entered the sector as a school leaver. In 1993, he joined Aberdeen-based convenience stores Aberness Foods, which traded as Mace. He rose to become Sales Director, boosting income by 50 per cent and tripling profits, and went on to be Managing Director, successfully leading the business through a strategic sale to supermarket group Somerfield.
Throughout a stellar business career, Stanley has set up, led, managed and sold more than 100 companies, from retail, wholesale and property to coaching and mentoring firms, in the UK and internationally.
An MBA graduate in retailing and wholesaling from the University of Stirling and Chair of the University of Stirling Management School’s International Advisory Board, Stanley was recognised with an MBE in 2022 for his work to support sustainable food and drink production in north-east Scotland.
Collecting his degree along with more than 300 other graduates at Friday morning’s ceremony, Stanley said, “I am deeply honoured to receive this recognition from the University of Stirling, where I completed my MBA in 1998. The University has played a pivotal role in shaping my career, and it has been a privilege to serve as Chair of the International Advisory Board at Stirling Management School since early 2020.
“This honorary degree reflects the University's commitment to cultivating industry partnerships and its dedication to preparing students for success in the business world. I was grateful for the opportunity to contribute to Stirling's mission of fostering innovation and developing future leaders.”
Professor Sir Gerry McCormac, Principal and Vice-Chancellor of the University of Stirling, said: “We are delighted to be awarding an Honorary Doctorate to Stanley Morrice, who has been an influential and exemplary figure in business and entrepreneurship, and in his advisory role at the University of Stirling. We know Stanley’s accomplishments, impact and leadership will be an inspiration to those graduating alongside him this week.”
In total, more than 1,000 students will graduate from the University of Stirling this week. Three ceremonies are being held across two days (21 – 22 November) as students celebrate their academic achievements alongside their families, friends and University staff.
British consumers have turned less pessimistic following the government's first budget and the US presidential election and they are showing more appetite for spending in the run-up to Christmas, according to a new survey.
The GfK Consumer Confidence Index, the longest-running measure of British consumer sentiment, rose to -18 in November, its highest since August and up from -21 in October which was its lowest since March.
Economists polled by Reuters had expected a deterioration in the confidence indicator to -22. Neil Bellamy, GfK's consumer insights director, said consumers seemed to have moved past their nervousness in the run-up to the 30 October budget and the 4 November US elections.
Finance minister Rachel Reeves announced a big increase in taxes on 30 October but the burden fell mostly on businesses rather than individuals.
Bellamy said it was too soon to say a corner had been turned. "As recent data shows, inflation has yet to be tamed, people are still feeling acute cost-of-living pressures, and it will take time for the UK's new government to deliver on its promise of 'change'," he said.
All five of the five components of the GfK's survey rose this month, led by a gauge of shoppers' willingness to make expensive purchases which rose five point to -16.
The survey was conducted between 30 October and 15 November and was based on the responses of 2,001 people.
GfK’s survey reported modest improvements in consumer measures of their personal finances and the general economic situation over the next 12 months. The figures clash with a separate survey of 1,500 households which showed growing pessimism over job security, according to S&P Intelligence.
“Consumer confidence continues to be variable but ability to spend depends on household circumstance,” Linda Ellett, UK head of consumer and retail at KPMG, said. “Inflation and interest rates having not yet sufficiently fallen and a toughening labour market are all weighing on the minds of many people.”
The government announced a £20 billion rise in employer national insurance contributions at the budget, as part of its promise not to hit “working people” with extra levies. Labour has also cut back on winter fuel payments for all pensioners, and said it will boost pay for public sector workers this year.
Shareholders in food and drink giants such as PepsiCo, Coca-Cola and Mondelez are among a group of investors calling on the sector to be more transparent about the healthiness of its sales as a first step towards taking accountability for its significant impact on public health, in a move coordinated by responsible investment NGO ShareAction, the NGO stated.
The investors include Legal & General Investment Management, Pictet Asset Management, Nest, and CCLA, who collectively manage £2.34trn in assets. In a letter delivered today (21) to the chief executives of PepsiCo, Coca-Cola, Mondelēz, Kraft Heinz, Kellanova, and General Mills, investors have called on the companies to follow the likes of Unilever and Danone in adopting internationally-accepted nutrition standards for publicly reporting the healthiness of their sales.
The investors have raised concerns that an over-reliance on sales of less healthy products leads to poor diets and sicker societies, which they claim harms economic productivity and threatens long-term business success and financial returns. The investors added that a lack of transparency hinders their ability to fully assess risks and opportunities.
“We believe that health is a systemic risk that affects the whole economy,” said Tom Sanders, Senior ESG Analyst at Nest. “The increased consumption of unhealthy products harms public health and could reduce worker productivity, creating externalities that can impact our long-term investment returns as a globally diversified investor. Food and drink companies must take responsibility in helping manage these risks by being more transparent, using internationally recognised nutrition standards as an important first step.”
The move comes amid an increasing focus by governments and consumers on the food and drink sector’s reliance on sales of foods that are high in fat, salt and sugar. Around one in eight people globally are living with obesity, including millions of children, which is projected to cost the global economy more than £3.34trn a year by 2035.
Thomas Abrams, Co-Head of Health at ShareAction, said: “It’s really encouraging to see the momentum building among the investment community to hold the food and drink sector to account for its impact on public health. By adopting a responsible investment approach to public health investors can not only manage financial risks but also help more people to enjoy healthier lives for longer.”
ShareAction and the investors are asking the food and drink companies to commit to adopting one or more of the internationally accepted Nutrient Profiling Models used to define healthy food, rather than their own in-house versions.