UK retail sales volumes in year to October fell at a sharper pace than previous month, down 36% compared to 14% in year to September, expected to decline 13% in November; internet sales volumes fell at fastest pace on record, down 78%: CBI

LONDON , October 27, 2023 (press release) –

Retail sales volumes fell sharply in the year to October, according to the latest quarterly CBI Distributive Trades Survey. Retailers do not anticipate a turnaround in the sector’s fortunes next month, with sales volumes expected to continue falling in the year to November.

The key survey findings included:

• Retail sales fell in the year to October, and at a faster pace than last month (weighted balance of -36% from -14% in the year to September). This marks the sixth month in a row in which annual sales have declined. Sales volumes are expected to continue falling next month, but at a slower pace (-13%).
• Retailers judged sales to be poor for the time of year (-10% from +5% in September). Sales volumes are expected to fall short of seasonal norms to an even greater extent next month (-21%).
• Orders placed upon suppliers continued to fall in the year to October, and at a faster rate than last month (-37% from -19% in September). Retailers expect to cut back sharply on orders again next month (-30%).
• Retailers reported stocks as “too high” relative to expected sales in October (+27% from +6% in September). Stock positions are expected to soften somewhat next month (+19%).

Martin Sartorius, CBI Principal Economist, said:

“As the festive period approaches, the retail sector remains in a perilous position. Sales volumes have been falling year-on-year for six months in a row, as cost-of-living concerns and higher interest rates weigh on consumer spending. Retailers expect the downturn in sales to continue next month, albeit at a slower pace.

“While slowing inflation should help to bolster households’ income in the coming months, retailers will continue to face headwinds from higher energy and borrowing costs. The Autumn Statement could help relieve some of the tax burden on the sector by freezing business rates from rising with inflation for another year.”

In addition, data from the survey showed:

• Internet sales volumes fell at the fastest pace on record (-78% from -3% in September; question introduced in August 2009). Online sales are expected to contract again next month, but at a relatively slower rate (-45%).
• Elsewhere in the distribution sector, wholesale volumes fell more slowly in the year to October compared with the previous month (-15% from -23% in September), and are expected to contract at a broadly similar pace next month (-18%). Motor trade volumes fell slightly in the year to October (-5% from +15% in September), and are expected to decline at a similar rate next month (-5%).

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