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Economy

Retail sales above seasonal norms for first time in 2021

Retail sales exceeded seasonal expectations for the first time in 2021 according to the CBI’s latest monthly Distributive Trades Survey.

With non-essential retail stores able to re-open as of this month, the CBI survey showed sales are expected to remain above seasonal norms in the year to May.

The survey aggregates the views of 124 businesses, 60 of which are retailers.

The best performing retailers were Hardware and DIY, furniture and carpets businesses, with grocers and non-store retailers also reporting that sales were good for the time of year.

Clothing and footwear store sales, meanwhile, remained well below seasonal norms.

Overall sales volumes rose at the fastest rate since September 2018 in the year to April, although this was inflated by the fact that, in April 2020, sales were significantly impacted by the first national lockdown.

Internet sales continued to grow at an above average pace and are expected to do so again in the year to May.

The volume of orders placed by retailers with their suppliers was broadly unchanged in the year to April but is expected to fall slightly in the year to May.

Meanwhile, the level of stocks in relation to expected sales was seen as broadly adequate in April, but this was the lowest survey balance since 2009, with little change expected next month.

Motor traders and wholesalers reported that sales were good for the time of year for the first time since October and December, respectively.

However, both sectors reported stock levels in relation to expected sales as too low and expect this to remain the case next month.

Ben Jones, principal economist at the CBI, said: “Springtime has brought some relief to the retail sector, with non-essential stores in England and Wales re-opening earlier this month, and retailers in Scotland and Northern Ireland following suit in the final week of April.

“Despite progress along the roadmap, the impact of Covid-19 restrictions is still biting hard.

“The improvement in retail sales this month was driven by sectors that have performed relatively well during the pandemic, with little immediate rebound expected for more embattled sectors such as clothing, footwear and department stores.

“And retailers are still facing challenges around inventory management and their supply chains, amid trade disruption, big shifts in consumer behaviour and uncertainty over how long some degree of social distancing could remain in place.”