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QSM Q2 2019 – Spring sales fail to shine

Sales were up for Cookshop & Housewares, Floor Coverings, Beds & Soft Furnishings and Books & Toys, Music, Computers/Telecoms independent retailers between April and June 2019, but all other sectors have seen a drop.

The overall picture from Bira’s exclusive Quarterly Sales Monitor (QSM) for the second quarter of 2019 is one of disappointment, with the vast majority of the figures showing a decline when compared to the previous quarter and Q2 2018. Only three out of the twelve sectors surveyed reported a positive performance during the quarter, with nine out of twelve showing a decline when compared to Q2 2018. Overall, 41.07% of respondents reported a higher performance for Q2 which is down significantly on Q1 2019 (51.75%) and Q2 2018 (51.55%). The overall performance average for the quarter shows a fall of -2.94% for retailers, compared to the same period last year.

Cookshop & houseware sales were higher for the second quarter of the year, with the sector seeing a +2.41% higher performance against Q2 last year. The poor housing market coupled with a reluctance to buy before Brexit may have led to higher sales of furniture, floor coverings, beds and soft furnishing products as respondents for the sector reported an improvement of +2.11% when compared Q2 last year (-2.51%).

The worst performing sector in the QSM was Gifts, Glass, China, Jewellery, Accessories and Luggage which was down -6.75% on Q2 2018. This is the second quarter in a row that the sector has dropped as respondents in Q1 reported a performance of -5.07%. Other struggling sectors include pet product stores and cards, stationery, crafts and hobby store retailers, which were both down by -5.4%.

East Anglia was the best performing region with retailers being +1.32% up on Q2 last year. This represents a great recovery for the area as retailers in the region reported a performance of -1.21% in Q1. Retailers in Scotland and the South West have continued to struggle, showing declines of -6.74% and -4.82% respectively. This is a worrying sign as both regions had a poor Q1. Generally, it has been a disappointing quarter overall for the remaining regions with all reporting a decline in sales.

It is clear from respondents that increases to wages have not translated into greater spending amongst consumers and as such, it has led to 57.14% of respondents feeling anxious about the year ahead. This coupled with ongoing Brexit uncertainty, two years after the result, is still clearly having an impact with 64.73% of retailers facing modest margin pressures, due to a weaker Pound as a result. Ongoing issues such as business rates, rising rents, parking and online selling are still concerns for independent retailers.

Andrew Goodacre, Bira’s CEO said: “The latest figures from the second QSM of 2019 reflect a disappointing second quarter for independent businesses, after what was a positive start to 2019. To see only 41.07% of respondents have reported a higher performance average and to see an overall drop of -2.94% for retailers is worrying and reflective of the tough testing times retailers are currently facing.

An increase in wages has not translated into greater consumer spending and the ongoing Brexit uncertainty is putting off consumers and businesses from buying. Retailers are being forced to prepare for a post-Brexit future without any indication of what that future is, and as such they are unable to focus their time on important factors such as pricing and improving customer experiences. With a new Prime Minister now in place, it is crucial that the Government finds a solution to Brexit that works for independent businesses as we head into the busiest trading period of the year.

As always, Bira will continue to fight the corner for independent businesses across the UK and I encourage all members to complete our surveys, to help us do this.”

About the QSM
We run the Quarterly Sales Monitor four times a year and along with the report, it is the only survey of its kind that reflects the independent retail industry in the UK. The report features full analysis from the survey as well as all member comments. All reports are then used to influence the media and Government through our Legal and Parliamentary Affairs Committee (LPAC), with all participants receiving a copy of the results.

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