Description
“The retail sector moves into the final two months of the year in a far better position in 2021 than in 2020. However, while the pandemic led-restrictions which disrupted trade in 2020 have eased, inflationary pressures and uncertain consumer confidence make peak 2021 no less challenging. While these factors will loom large on purchasing decisions, there is a strong willingness from consumers to enjoy themselves this year following the disruption of last Christmas and the broader events of the past two years.”
– Emily Viberg, Retail Analyst
This month’s UK Retail Briefing includes:
- Analyst Comment – The Prospects for Christmas 2021
- An overview of the latest UK Retail sales
- Sector focus – Grocery retailing
- Highlights of the latest UK Retail trend observations.
- Monthly headlines and retail news across the UK
Table of Contents
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Analyst Comment: The Prospects for Christmas 2021
- Demand holds up in Q3 as restrictions lifted
- Figure 1: Retail sales, 2020 and 2021 sales growth versus 2019, non-seasonally adjusted, 2019-21
- Concerns regarding COVID-19 have eased but will remain a key factor in Q4
- Figure 2: COVID-19 Tracker, online and in-store behaviour and concern level regarding COVID-19, 2020-21
- Confidence and willingness to spend has improved…
- Figure 3: Confidence in household finances over the coming year, 2020-21
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- Figure 4: Financial confidence tracker, confirmed spending in key areas, 2019-21
- Earlier spending, online demand but a willingness to get back on the high street
- Figure 5: Concerns over stock shortages in 2021
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- Figure 6: Attitudes to shopping on the high street this Christmas, 2021
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- Figure 7: Plans to see people this Christmas, 2021
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- Figure 8: Attitudes to crowded areas and shopping online this Christmas, 2021
- Christmas spending intentions
- Figure 9: Spending intentions in core categories this Christmas, 2021
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- Figure 10: Net spending intentions this Christmas, percentage point difference between ‘more’ and ‘less’, 2021
- Polarisation of finances will mean opportunities at both ends of the market
- Figure 11: Financial concerns this Christmas, 2021
- Grocery: out of home hesitancy to boost volumes
- Figure 12: Out of home spending intention this Christmas, 2021
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- Figure 13: Weezy Bonfire Night Activation, 2021
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- Figure 14: In-home grocery spending intention this Christmas, 2021
- Home: more hosting brings opportunities
- Figure 15: Refreshing the home this Christmas, 2021
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- Figure 16: Intention to spend on the home this Christmas, 2021
- Toys: the focus but supply brings issues
- Figure 17: Intention to spend on toys this Christmas, 2021
- Fashion: back in the mix
- Figure 18: Need to refresh wardrobes this Christmas, 2021
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- Figure 19: Intention to spend on fashion this Christmas, 2021
- Final thoughts and our forecast
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- Figure 20: Combined November and December retail sales growth (non-seasonally adjusted), by major category, 2019-21
- Demand holds up in Q3 as restrictions lifted
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UK Retail Sales
- Key points
- Retail sales
- Figure 21: Retail sales trends January 2019-September 2021
- BRC vs ONS
- Figure 22: UK retail sales y/y growth, BRC vs ONS, January 2018-August 2021
- Inflation
- Figure 23: Annual % change in the consumer price index for selected product groups, 2019-21
- Inflation and wages
- Figure 24: Real wages growth: wages growth vs inflation, 2016-21
- Looking forward
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Sector Focus – Grocery Retailing
- Retail sales
- Figure 25: All retail sales (ex-fuel), non-seasonally adjusted, 2020-21
- Growth in grocery boosted by out-of-home spending
- Figure 26: Annual % change in all grocery retail sales and store-based online grocery retail sales, 2021
- Supermarkets are preferred retailers to food and drink specialists
- Figure 27: Attitudes towards specialist food and drink retailers, December 2020
- Retail sales
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Launch Activity and Innovations
- UK: Aldi to open 15 new stores by the end of 2021
- UK: Curry’s and Uber partner up for 30-minute deliveries
- UK: Gopuff launches nationwide
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Headlines for the Month
- Grocers
- Clothing retailing
- Footwear retailing
- Multi-sector retailing
- Department stores
- Online
- Sports and leisure goods retailing
- Jewellers
- Toys and games retailing
- Economy
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News Analysis – Food and Drink
- Grocers
- UK: Aldi removes plastic trays in a bid to reduce plastic waste by 116 tonnes
- …removes plastic from toy ranges
- UK: Asda owners consider expanding convenience stores format across Europe
- UK: Morrisons partner with McDonald’s to launch sustainable food and farming school
- UK: Tesco to have fully electric delivery fleet by the end of 2028
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News Analysis – Clothing and Footwear
- Clothing retailing
- UK: Burberry unveils biodiversity strategy at COP26
- UK: French Connection reduces losses following £29m takeover
- UK: Next sales up 17% in Q3 but anticipates supply issues to dampen Christmas trading
- UK: Primark sales down 12% as it struggles with rising costs
- UK: Reiss set to open new Edinburgh store
- UK: Superdry hopes for strong Christmas as it unveils new London flagship
- UK: Timberland teams up with Hurr for rental collection
- Footwear retailing
- UK: Foot Locker completes takeover of Japanese streetwear brand Atmos
- UK: Hotter Shoes launches first-ever pop-up shop
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News Analysis – Mixed Goods
- Multi-sector retailing
- UK: Halfords ups earnings forecast to £90m
- UK: M&S
- …sales up 5% driven by online clothing and home categories
- …to launch in-store optician branches
- Department stores
- UK: Harrods
- …turnover plummet 50.7% due to store closures
- …launches pop-up focusing on Chinese designers
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News Analysis – Online
- UK: Argos delays toy promotions ahead of Christmas amidst supply chain issues
- UK: Asos offers paid leave for health-related issues
- UK: Boden sales down to £256m
- UK: Boohoo unveils Debenhams.com first Christmas advert
- UK: Depop becomes a certified climate-neutral company
- UK: Matchesfashion sales fall by £41m due to the impact of COVID-19
- UK: Net-a-Porter launches resale service Reflaunt
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News Analysis – Other Retail
- Health and beauty retailing
- UK: The Body Shop to launch open hiring scheme
- UK: Estée Lauder closes designer fragrance licensing division
- Sports and leisure goods retailing
- UK: JD Sports ordered by competition watchdog to sell Footasylum
- Jewellers
- UK: Beaverbrooks sales down 14% during centenary anniversary
- Toys and games retailing
- UK: Hobbycraft launches Christmas workshops for businesses
- Economy
- UK: BRC
- …like-for-like sales down 0.2% in October
- …retail sales growth slow in September
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