Hand-rolling tobacco was never just about saving money. For devotees of the self-made cig, the economics were a welcome advantage, but the truth was that the tobacco – fresh and aromatic – was always the true selling point. You couldn’t get away with a second-class product when the customers literally felt it between their fingers. Words that come to mind when thinking about hand-rolling are vintage and artisanal, the old and best way of smoking a cigarette – a cowboy cigarette put together just the way you like it – made to-measure rather than off-the-peg; craftsman not factory.
As government policies and taxes have eaten away at the consumer’s ability to enjoy factory-made cigarettes (FMCs) over the years, the sector has seen suppliers and smokers attempt to retain their enjoyment in various ways. One of these was to move to value FMCs and the other was to smoke more RYO tobacco. In the old days there were cigarette smokers and “rollie” smokers and they were mostly separate. Now that is no longer the case and smokers are more likely to utilise both ready-made and hand-made versions.
This year, though, with inflation and taxes both up, it could mean that more people than ever will be trying out the finest tobaccos money can buy.
RYO goes mainstream
The UK the tobacco market, which constitutes an important element of c-store sales alongside the increasing vape sector, is worth an enormous £14 billion per year, split pretty evenly these days between FMC and RYO – at 53 per cent and 47 per cent respectively.
“Overall, we’re seeing continued movement towards low priced propositions across the entire category as consumer demand for value continues to drive tobacco purchasing patterns,” says Duncan Cunningham, UK Corporate Affairs Director at Imperial Tobacco & blu. “As part of this shift, the lower price tiers now account for the majority of sales, with the sub-economy segment making up 63 per cent share of FMC, and the economy segment accounting for 51 per cent of RYO, with both value segments growing at 4 per cent YOY.”
With the tobacco market being populated by value FMC and RYO, it behoves retailers wishing to maximise sales to look afresh at what they can offer customers in terms of tobacco packs and the all-important accessories that accompany them.
Cunningham emphasises that the transition towards lower-priced tobacco is a “key trend” that retailers should be prepared for. He says that tobacco shoppers have an average basket spend worth £19.60 vs. non-tobacco at £11.40, and they also visit more frequently, averaging 2.9 visits a week in comparison to 2.5 for other shoppers: “Convenience retailers are in a strong position to benefit from these increased visits and basket spend in the years to come, with figures forecasting almost 13 per cent growth in Convenience over the next 5 years.”
From this perspective the tobacco category is in very good health despite declining smoker numbers. The main point is that they are all looking for good value, and even within RYO the value segment is over half, with mid and premium blends making up the remaining sales, at 35 per cent and 14 per cent of the loose tobacco market.
What this means is that there are very good products available from the tobacco companies who are very well aware of howe important it is to cater to the growing RYO demographic, many of whom have migrated to loose tobacco from FMNCs.
Ross Hennessy, Sales Vice President at JTI UK, explains that the brands in RYO, which also feature well-known loose-tobacco incarnations of well-loved FMC names, are doing extremely well, with value the watchword. “Price remains a key factor for existing adult smokers,” he confirms.“Retailers should therefore stock up on Value RYO products, such as Sterling RYO, the leading Value RYO brand.”
Sterling has indeed established itself front and centre in the RYO gantry, and is now available in a very practical 50g package.
“Building on the success of the 30g, JTI has announced the new 50g format, which offers the same fantastic RYO quality at a competitive RRP of just £23.35.” The 30g variant costs £13.65.
Hennessy continues: “JTI’s decision to release this new, larger format of Sterling Essential Rolling Tobacco reflects the increase in demand for RYO, with the category growing 7.4 per cent year on year,and generating sales of £3.9 billion a year. Sterling Rolling is the UK’s second fastest growing RYO brand,showing that the demand for value tobacco continues.”
The 50g is a “less for less alternative” just like its 30g partner. This means keeping the price lower by not including filters or papers. By happy design, this affords smokers the freedom to purchase their preferred tobacco accessories, of which there is a great selection on offer from companies such as Republic Technologies and Clipper.
Duncan Cunningham, meanwhile, speaks enthusiastically of Imperial’s top-notch RYO brands on offer.
“Our new JPS Players Easy Rolling Tobacco is a great example of what retailers should be stocking to cater for these increasingly value savvy shoppers,” he says. “JPS Players Easy Rolling Tobacco is an exciting new blend of fine cut tobacco that offers an easier rolling experience and benefits from the brand recognition of one of the UK’s best-selling cigarette brands.”
This new JPS Players Easy Rolling Tobacco features a more vibrant colour and lower levels of moisture, making the blend easier to handle and to roll. The range is available to buy in 30g and 50g and priced at £12.95 and £21.20, and these each come with a set of quality rolling papers.
Another RYO brand that is a must-stock for any retailers tapping into the value trend is JTI’s Riverstone, which was recently repositioned to sit within the rising economy RYO segment alongside JPS Players, with its 30g and 50g pouches also priced at £12.95 and £21.20 and including both papers and filters for the ultimate in convenience. With these products, Imperial is clearly targetting a growing market, making the brands essential for canny c-store retailers.
JTI also retains the option for smokers who want to find everything they need in the pouch – the so-called 3-in-1 format.
“Our Sterling 3-in-1 Rolling Tobacco offers existing adult smokers the fuss-free and convenient format they want, with tobacco, papers and filters in one handy pouch,” says Hennessy.“Retailers should look to stock up on Sterling 3in1 to provide an option for customers looking for great value and extra convenience.”
Selling great products alongside
Gavin Anderson, Sales & Marketing Director at Republic Technologies (UK) Ltd, is a great voice for telling retailers exactly what they need to hear: that tobacco sales can be driven higher when they are sold alongside the best accessories money can buy, making the whole experience more satisfying and enjoyable, adding choice, colour and quality.
The increasing shift to RYO amongst smokers is continuing to provide major profit opportunities in this category for convenience retailers, with the accessories category currently worth £320 million and showing YoY growth of +4.8 per cent (even as the overall tobacco category slowly shrinks YoY by around 3 per cent – highlighting the RYO opportunity).
“The pandemic and subsequent lockdowns brought more shoppers than ever to local convenience stores, as people chose to stay local and minimise supermarket visits,” explains Anderson.“This gave retailers an even bigger opportunity to drive visibility of margin-boosting tobacco accessories products.”
Gavin Anderson
He says that by ensuring they are fully stocked with a range of tobacco accessories from trusted brands, retailers can cater for every customer and drive sales: “As category specialists, we’re continuing to innovate. Not just with NPD but with a renewed focus on merchandising solutions, enabling retailers to highlight NPD and increase visibility of best-selling products.
“Our iconic brands – including Swan, Zig-Zag and OCB – have considerable history in the market and are synonymous with quality and value for money. This, combined with our team’s valuable expertise in the category, means that we are well placed to add real value to convenience retailers.”
Anderson says that there has been a surge in demand for category-boosting products such as OCB Virgin Slim, RRP: £1.04 and OCB Virgin Slim & Tips, RRP: £1.63.
Republic also supplies Swan, the brand of choice for many RYO shoppers, and the Crushball filters have built up a strong and loyal consumer following since legislation changed in 2020, says Anderson. We are still seeing more and more shoppers actively looking for this bestselling SKU in their local store.
Swan Cool Burst and Fresh Burst Crushballs come as two-part sliding packs containing 54 filters, both with an RRP of £1.29, and are available in slim vertical shelf-ready boxes.
When you are ready to light up, Clipper lighters are the perfect solution. “Clipper is thriving,” says UK General Manager Miguel Toral, when contacted by Asian Trader. “Our brand is leading with 42.6 per cent of market share with three percentage points increase MAT. Other studies show that Clipper still has the strongest brand awareness within the UK lighter market, with a significant lead in spontaneous awareness. Although the lighter market is saturated with many different brands, Clipper remains at the top spot as the UK’s No.1 lighter.”
Despite a pre-pandemic drop in lighter sales, Clipper remained in demand,“and when confidence was restored in the economy, our sales figures were back rising again. Although there has been this decrease in the overall lighter market, Clipper has still managed to remain strong and increase its sales figures,” he adds.
New NPD includes the Clipper utility lighter TUBE PLUS, which is an improved version of previous utility lighters. Not only has the TUBE PLUS been made with more resistant materials, it also has double the gas capacity compared to the regular Tube. This product is now part of the collections range, meaning it will feature unique print finishes as seen with Clipper’s other classic range.
Sustainable smoking
All the producers are going full-steam ahead in trying to build sustainable processes and products. JTI’s Hennesy says that its Sterling Essential Rolling Tobacco 50g now comes in paper insert pouch packaging which contains less aluminium, “and the blend generates less leaf waste compared to other RYO brands due to its unique whole leaf blend.”
Miguel Toral
Clipper likewise is acutely aware of how its products can fit into this new eco-awareness: “We are certainly seeing a more intelligent shopper who is considering the environmental impact in their choices,” Toral agreed. “Clipper offers consumers the choice to reduce their carbon footprint, with full reusability. With 50 per cent of our consumers making use of our reusability already, we expect to see these figures increase as more environmental awareness gets shared. With Clipper, there is no need to contribute to the vast amounts of plastic waste, as our iconic CP11 lighter offers you the ability to refill, re-flint and then reuse.”
Republic Technologies, meanwhile, reassure that, “With growing demand for more natural products and reduced packaging, Republic Technologies is increasing its focus on sustainably sourced products.” Its unbleached papers are made using OCB natural gum, which is sustainably sourced from African Acacia trees.
Best in store
So many sales go through the eye to the wallet that it is very worthwhile mastering the art of the glorious gantry and attractive shelf displays. Clipper displays such as carousels, four-tier stands and shape displays have become a real asset to retailers across the UK. They offer great value (with between 20-48 free lighters, and increase sell-out rotation by 50 per cent). and are all designed for countertops, making full use of precious space..
Kieran Marsh, Merchandising Design Lead Manager at JTI UK, agrees that displays sell well, and JTI is on top of it: “For retailers, there is now a larger category solution available, which includes backlighting where vaping, next-gen and tobacco products can be stored in the same gantry,” he says.
“The solution incorporates the entire [tobacco-vape] category and is available in a variety of widths; If this is of interest, speak to your JTI representative about our new category management solutions.”
Imperial’s Cunningham starts from the principle that no two stores are the same,“So it’s important to take time to consider what customers are buying most frequently, or not buying at all, and then adapting the range accordingly.”
He says, for example, that if a store has a really strong RYO customer base, it might want to consider offering a bigger range of filters, papers, flavour cards and lighters – something Anderson would endorse.“While, if they have more cigarette shoppers than RYO, they may want to offer a smaller range and focus this mostly on lighters and flavour cards.”
Cunningham adds that, given the value of tobacco shoppers in terms of the wider sales they generate in store, “We would recommend retailers make it clear that they sell tobacco by displaying products within an installed gantry. Even if retailers choose to stock tobacco products under the counter, it’s really important there’s signage that informs shoppers that tobacco is sold in store to avoid missing out on sales.”
Lastly, he emphasises that it is really important staff are knowledgeable about the range of accessories stocked so they are well equipped to answer any questions and offer advice to any shoppers that need it.
The UK retail sector is bracing for a challenging but opportunity-filled 2025, according to Jacqui Baker, head of retail at RSM UK. While the industry grapples with rising costs and heightened crime, advancements in artificial intelligence and a revival of the high street offer potential pathways to growth, she said.
The latest Budget delivered a tough blow to the retail sector, exacerbating existing financial pressures. Retailers, who already shoulder a significant portion of business rates and rely heavily on a large workforce, face increased costs from rising employers’ National Insurance Contributions.
“Higher costs will also eat into available funds for future pay rises, benefits or pension contributions – hitting retailers’ cashflow in the short term and employees’ remuneration in the longer term,” Baker said.
“Retailers must get creative to manage their margins and attract footfall and spend, plus think outside the box to incentivise employees if they’re to hold onto talented staff.”
On the brighter side, falling inflation and lower interest rates could ease operational costs and restore consumer confidence, potentially driving retail spending upward.
High street resurgence
Consumers’ shopping habits are evolving, with a hybrid approach blending online and in-store purchases. According to RSM UK’s Consumer Outlook, 46 per cent of consumers prefer in-store shopping for weekly purchases, compared to 29 per cent for online, but the preference shifts to 47 per cent for online shopping for monthly buys and to 29 per cent for in-store. The most important in-store aspect for consumers was ease of finding products (59%), versus convenience (37%) for online.
“Tactile shopping experiences remain an integral part of the purchase journey for shoppers, so retailers need to prioritise convenience and the opportunity for discovery to bring consumers back to the high street,” Baker noted.
The government’s initiative to auction empty shops is expected to make brick-and-mortar stores more accessible to smaller, independent retailers, further boosting high street revival, she added.
A security guard stands in the doorway of a store in the Oxford Street retail area on December 13, 2024 in London, EnglandPhoto by Leon Neal/Getty Images
Meanwhile, retail crime, exacerbated by cost-of-living pressures, remains a significant concern, with shoplifting incidents reaching record highs. From organised social media-driven thefts to fraudulent delivery claims, the methods are becoming increasingly sophisticated.
“Crime has a knock-on effect on both margins and staff morale, so while the government is cracking down on retail crime, retailers also have a part to play by investing in data to prevent and detect theft,” Baker said.
“Data is extremely powerful in minimising losses and improving the overall operational efficiency of the business.”
AI as a game-changer
Artificial intelligence is emerging as a transformative force for the retail sector. From personalised product recommendations and inventory optimisation to immersive augmented reality experiences, AI is reshaping the shopping landscape.
“AI will undoubtedly become even more sophisticated over time, creating immersive and interactive experiences that bridge the gap between online and in-store. Emerging trends include hyper-personalisation throughout the entire shopping journey, autonomous stores and checkouts, and enhanced augmented reality experiences to “try” products before buying,” she said, adding that AI will be a “transformative investment” that determines the long-term viability of retail businesses.
The Amazon Fresh store in Ealing, LondonPhoto: Amazon
As financial pressures ease, sustainability is climbing up the consumer agenda. RSM’s Consumer Outlook found 46 per cent would pay more for products that are sustainably sourced, up from 28 per cent last year; while 44 per cent would pay more for products with environmentally friendly packaging, compared to 36 per cent last year.
“However, ESG concerns vary depending on age and income, holding greater importance among high earners and millennials. With financial pressures expected to continue easing next year, we anticipate a renewal of sustainability and environmentally conscious spending habits,” Baker noted.
“Retailers ought to tap into this by understanding the preferences of different demographics and most importantly, their target market.”
Southend-on-Sea City Council officials have secured food condemnation orders from Chelmsford Magistrates Court, resulting in the seizure and destruction of 1,100 unauthorised soft drinks.
The condemned drinks, including Mountain Dew, 7-UP, Mirinda, and G Fuel energy drinks, were found during routine inspections of food businesses across Southend by the council’s environmental health officers.
Council said these products contained either banned additives like Calcium Disodium EDTA or unauthorised novel ingredients such as Potassium Beta-hydroxybutyrate.
Calcium Disodium EDTA has been linked to potential reproductive and developmental effects and may contribute to colon cancer, according to some studies. Potassium Beta-hydroxybutyrate has not undergone safety assessments, making its inclusion in food products unlawful.
Independent analysis certified that the drinks failed to meet UK food safety standards. Magistrates ordered their destruction and ruled that the council's costs, expected to total close to £2,000, be recovered from the businesses involved.
“These products, clearly marketed towards children, contain banned or unauthorised ingredients. Southend-on-Sea City Council will always take action to protect the public, using enforcement powers to ensure unsafe products are removed from sale,” Cllr Kevin Robinson, cabinet member for regeneration, major projects, and regulatory services, said.
“As Christmas approaches, we hope this sends a strong message to businesses importing or selling such products: they risk significant costs and possible prosecution.”
The council urged residents to check labels when purchasing imported sweets and drinks, ensuring they include English-language details and a UK importer's address.
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A customer browses clothes inside Charity Super.Mkt at Brent Cross Shopping centre in north London on, December 17, 2024
Bursting with customers one afternoon the week before Christmas, a second-hand charity shop in London's Marylebone High Street looked even busier than the upscale retailers surrounding it.
One man grabbed two puzzle sets and a giant plush toy as a present for friends, another picked out a notebook for his wife.
“Since the end of September, we've seen a huge uplift in people coming to our shops and shopping pre-loved,” said Ollie Mead, who oversees the shop displays - currently glittering with Christmas decorations - for Oxfam charity stores around London.
At the chain of second-hand stores run by the British charity, shoppers can find used, or "pre-loved", toys, books, bric-a-brac and clothes for a fraction of the price of new items.
Popular for personal shopping, charity stores and online second-hand retailers are seeing an unlikely surge in interest for Christmas gifts, a time of year often criticised for promoting consumerism and generating waste.
A report last month by second-hand retail platform Vinted and consultants RetailEconomics found UK customers were set to spend £2 billion on second-hand Christmas gifts this year, around 10 per cent of the £20 billion Christmas gift market.
A woman browses some of the Christmas gift ideas in a store on December 13, 2024 in London, England. Photo by Leon Neal/Getty Images
In an Oxfam survey last year, 33 per cent were going to buy second-hand gifts for Christmas, up from 25 percent in 2021.
“This shift is evident on Vinted,” Adam Jay, Vinted's marketplace CEO, told AFP.
“We've observed an increase in UK members searching for 'gift' between October and December compared to the same period last year.”
According to Mead, who has gifted second-hand items for the last three Christmas seasons, sustainability concerns and cost-of-living pressures are “huge factors”.
Skimming the racks at the central London store, doctor Ed Burdett found a keychain and notebook for his wife.
“We're saving up at the moment, and she likes to give things another life. So it'll be the perfect thing for her,” Burdett, 50, told AFP.
“It's nice to spend less, and to know that it goes to a good place rather than to a high street shop.”
'Quirky, weird
Wayne Hemingway, designer and co-founder of Charity Super.Mkt, a brand which aims to put charity shops in empty shopping centres and high street spaces, has himself given second-hand Christmas gifts for “many, many years”.
“When I first started doing it, it was classed as quirky and weird,” he said, adding it was now going more “mainstream”.
Similarly, when he first started selling second-hand clothes over 40 years ago, “at Christmas your sales always nosedive(d) because everybody wanted new”.
Now, however, “we are seeing an increase at Christmas sales just like a new shop would”, Hemingway told AFP.
“Last weekend sales were crazy, the shop was mobbed,” he said, adding all his stores had seen a 20-percent higher than expected rise in sales in the weeks before Christmas.
“Things are changing for the better... It's gone from second-hand not being what you do at Christmas, to part of what you do.”
Young people are driving the trend by making more conscious fashion choices, and with a commitment to a “circular economy” and to “the idea of giving back (in) a society that is being more generous and fair,” he said.
At the store till, 56-year-old Jennifer Odibo was unconvinced.
Buying herself a striking orange jacket, she said she “loves vintage”.
But for most people, she confessed she would not get a used gift. “Christmas is special, it needs to be something they would cherish, something new,” said Odibo.
“For Christmas, I'll go and buy something nice, either at Selfridges or Fenwick,” she added, listing two iconic British department stores.
Hemingway conceded some shoppers “feel that people expect something new” at Christmas.
“We're on a journey. The world is on a journey, but it's got a long way to go,” he added.
According to Tetyana Solovey, a sociology researcher at the University of Manchester, “for some people, it could be a bit weird to celebrate it (Christmas) with reusing.”
“But it could be a shift in consciousness if we might be able to celebrate the new year by giving a second life to something,” Solovey told AFP.
“That could be a very sustainable approach to Christmas, which I think is quite wonderful.”
Lancashire Mind’s 11th Mental Elf fun run was its biggest and best yet – a sell-out event with more than 400 people running and walking in aid of the mental charity, plus dozens more volunteering to make the day a huge success.
The winter sun shone on Worden Park in Leyland as families gathered for either a 5K course, a 2K run, or a Challenge Yours’Elf distance which saw many people running 10K with the usual running gear replaced with jazzy elf leggings, tinsel and Christmas hats.
And now the pennies have been counted, Lancashire Mind has announced that the event raised a fantastic £17,000.
This amount of money allows Lancashire Mind to deliver, for example, its 10-week Bounce Forward resilience programme in eight schools, reaching more than 240 children with skills and strategies that they can carry with them throughout their lives, making them more likely to ‘bounce forward’ through tough times.
The event was headline sponsored by SPAR for a third year through its association with James Hall & Co. Ltd, SPAR UK’s primary retailer, wholesaler, and distributor for the North of England.
“On behalf of the entire team at Lancashire Mind, we want to extend a heartfelt thank you to the 400+ incredible participants who joined us for Mental Elf 2024!” said Organiser Nicola Tomkins, Community and Events Fundraiser at Lancashire Mind.
“Your support, energy and commitment to raising awareness for mental health makes all the difference. Together, we've taken another important step towards breaking the stigma around mental health and promoting wellbeing for all in our community. We couldn't have done it without you!”
Worden Hall became the hub of the event where people could enjoy music from the Worldwise Samba Drummers and BBC stars Jasmine and Gabriella T, plus lots of family friendly activities and a chance to meet Father Christmas. Pets also got in on the act in the best dressed dog competition.
Lancashire Mind CEO David Dunwell said: “It was heart-warming day, full of community spirit and festive cheer, but with a serious aim to raise funds for mental health.
“We are so grateful to everyone who bought a ticket and fundraised or donated to help us smash our target. The money raised goes directly to supporting Lancashire Mind’s life-changing mental health services. These funds help provide wellbeing coaching, support groups, and educational programmes to individuals and families in need of mental health support in our community.”
The concept of Mental Elf was created by Lancashire Mind and news of the event has spread right across the country in recent years, with around 40 other local Mind charities hosting a similar event in 2024.
Lancashire schools were also encouraged to host their own Mental Elf-themed event this year, whether that was a run, bake sale or dress up day, and raised more than £1,000 in total.
Philippa Harrington, Marketing Manager at James Hall & Co. Ltd, said: “There was a lovely festive feel in the air at Mental Elf and we were delighted to see even more individuals, families, and canine companions taking part in its new home of Worden Park.
“We are also very pleased to see the uptake that Mental Elf has had in schools, and congratulations go to the Lancashire Mind team for taking it to new participants and for raising a fantastic amount of money for an important cause.”
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A woman walks past a window display promoting an ongoing sale, on December 13, 2024 in London, England.
UK retail sales rose less than expected in the runup to Christmas, according to official data Friday that deals a fresh blow to government hopes of growing the economy.
Separate figures revealed a temporary reprieve for prime minister Keir Starmer, however, as public borrowing fell sharply in November.
The updates follow news this week of higher inflation in Britain - an outcome that caused the Bank of England on Thursday to leave interest rates unchanged.
Retail sales by volume grew 0.2 per cent in November after a drop of 0.7 per cent in October, the Office for National Statistics said Friday.
That was less than analysts' consensus for a 0.5-percent gain.
"It is critical delayed spending materialises this Christmas to mitigate the poor start to retail's all-important festive season," noted Nicholas Found, senior consultant at Retail Economics.
"However, cautiousness lingers, slowing momentum in the economy. Households continue to adjust to higher prices (and) elevated interest rates."
He added that consumers were focused on buying "carefully timed promotions and essentials, while deferring bigger purchases".
The ONS reported that supermarkets benefited from higher food sales.
"Clothing stores sales dipped sharply once again, as retailers reported tough trading conditions," said Hannah Finselbach, senior statistician at the ONS.
Retail sales rose 0.2% in November 2024, following a fall of 0.7% in October 2024.
Growth in supermarkets and other non-food stores was partly offset by a fall in clothing retailers.
The Labour government's net borrowing meanwhile dropped to £11.2 billion last month, the lowest November figure in three years on higher tax receipts and lower debt-interest, the ONS added.
The figure had been £18.2 billion in October.
"Borrowing remains subject to upside risks... due to sticky interest rates, driven by markets repricing for fewer cuts in 2025," forecast Elliott Jordan-Doak, senior UK economist at Pantheon Macroeconomics.
Jacqui Baker, head of retail at RSM UK and chair of ICAEW’s Retail Group, commented that the later than usual Black Friday weekend meant November’s retail sales figures saw only a slight uptick as cost-conscious consumers held off to bag a bargain.
“Despite many retailers launching Black Friday offers early, November trade got off to a slow start which dragged on for most of the month. This was driven by clothing which fell to its lowest level since January 2022. The only saving grace was half-term and Halloween spending helped to slightly offset disappointing sales throughout November,” Baker said.
“As consumer confidence continues to build and shoppers return to the high street, this should translate into more retail spending next year. However, there are big challenges coming down the track for the sector, so retailers will be banking on a consumer-led recovery to come to fruition so they can combat a surge in costs.”
Thomas Pugh, economist at RSM UK, added: “The tick up in retail sales volumes in November suggests that the stagnation which has gripped the UK economy since the summer continued into the final months of the year.
“While the recent strong pay growth numbers may make the Bank of England uncomfortable, it means that real incomes are growing at just under 3 per cent, which suggests consumer spending should gradually rise next year. However, consumers remain extremely cautious. The very sharp drop in clothing sales in particular could suggest that consumers are cutting back on non-essential purchases.
“We still expect a rise in consumer spending next year, due to strong wage growth and a gradual decline in the saving rate, to help drive an acceleration in GDP growth. But the risks are clearly building that cautious consumers choose to save rather than spend increases in income, raising the risk of weaker growth continuing through the first half of next year.”