Insight UpdateNews

Fears over war’s impact and cost of living forced High Street and online sales down in February

February’s retail sales figures from the Office for National Statistics (ONS) saw an unexpected fall of -0.3% in the amount of goods sold during February.

Even the value of goods bought online fell by -0.7% against the previous month. The home delivery expert ParcelHero says this was largely down to fears about rising household bills, which this week’s mini-budget will have done little to calm.

ParcelHero’s head of consumer research, David Jinks M.I.L.T., said: “After a healthy pickup in spending in January of 2%, this fall in the amount of goods sold compared to January was disappointing for retailers, and does not augur well for future months. This was particularly disappointing considering that England’s remaining Covid-19 restrictions ended on 24 February. Fears over a potential invasion of Ukraine, which eventually happened (also on 24 February), together with eye-watering rises in home energy bills, meant consumers kept their hands firmly in their pockets and away from their wallets.

“Online sales fell -0.7% against January 2022 and by a steep -18.1% against the same period last year, February 2021. Online spending now accounts for 27.8% of all retail spending, against a high of 36.5% of all retail spending in February 2021. That doesn’t mean High Street stores should be celebrating the demise of online shopping any time soon, however. In January, e-commerce took just 25.3% of the entire retail spend, so that’s an increase in e-commerce’s market share of 9.8% month-on-month.

“Longer term, UK retailers must align their High Street and online sales to counteract a likely further fall in consumer confidence in the months ahead. ParcelHero’s influential report “2030: Death of the High Street” has been discussed in Parliament. It reveals that, unless retailers develop an omnichannel approach, embracing both online and physical store sales, the High Street as we know it will reach a dead-end by 2030.”

Read the full report at:

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