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Sunshine lifts March sales, online and off

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March sunshine lifted retail sales, both on and offline, according to the latest figures from the British Retail Consortium.

Online sales rose by 13.9% last month, putting in their strongest performance since December, today’s BRC-KPMG Retail Sales Monitor for March 2012 found. The category also includes mail order and telephone sales.

At the same time, UK retail sales, which mostly take place in shops, rose by 3.6% in total, and 1.3% on a like-for-like basis, stripping out the effect of store openings and closures.

“Online retail benefited from the warmer weather in March in much the same way as store sales, with people keen to buy clothes, footwear and garden furniture.” said Stephen Robertson, director general of the British Retail Consortium. “That helped sales grow 13.9% compared with the same month a year ago, the best online performance since December.”

However, he pointed out, last March’s figures were particularly weak, making this year’s look stronger by comparison. “Online retail continues to expand but the rate of growth is well behind the peaks of previous years,” he said. “Sales are increasingly dependent on promotions and offers which are eating into margins.” The BRC estimates, based on ONS figures, that 9% of UK retail sales take place online.

On the high street, said Robertson, warm weather lifted sales of clothes, shoes, gardening gear and outdoor leisure equipment. But, he said, households were struggling to balance budgets with the expense of fuel and utilities. “The warmth of March was a help but it will take more than a week of sunshine to transform retailers’ fortunes.”

Helen Dickinson, head of retail at KPMG, said: “As consumers’ incomes continue to be squeezed, it’s female shoppers who are tightening their purse strings most severely, focusing more on lower price point items to control the household budget. This buying behaviour saw women’s clothing perform less strongly than men’s and childrenswear. Home accessories and textiles also had a poor month.”

And while food sales rose during the month, it was agreed that was driven by price inflation rather than increased volumes. “Increases in food prices rather than volumes was one of the factors behind the uplift in this month’s figures,” said Dickinson. “Rising petrol prices continued to drive up transport and manufacturing costs, causing food prices to increase each month since the start of the year.”

Joanne Denney-Finch, chief executive of food and drink analysts IGD, said: “Mothering Sunday provided a mid-month boost to food and grocery sales in March. Easter now marks the start of a unique succession of events in the coming months, including the Diamond Jubilee and Olympics. The British love a reason to celebrate and our ShopperVista research shows many shoppers enjoy themed promotions and in-store activities.”

Jon Copestake, retail analyst at the Economist Intelligence Unit, said: “The rollercoaster ride for the British retail sector and high street continues. On one hand Deloitte report 10,000 retail job losses and a 15% increase in administrations for Q1 2012, on the other the BRC report a welcome 1.3% boost in retail sales.

“It may be a little early to talk of recovery though. The BRC rightly point to the weather and poor sales last year as mitigating factors. The impact of the weather and the fickle nature of retail sales cannot be ignored. Retail counter Springboard reported that rain prompted a 12.5% drop in year-on-year footfall for Easter which could make April’s retail sales figures a little less sunny.”

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