During the period from June 1 to July 5, UK retail sales saw a year-on-year increase of 3.1% in June, contrasting with a decline of 0.2% in June 2024. Food sales rose by 4.1%, while non-food sales increased by 2.2%. In-store non-food sales matched the overall non-food increase, and online non-food sales grew by 2.3%. The online penetration rate for non-food items was stable but below the 12-month average. Influencing factors included weather conditions and food inflation, alongside potential changes in government business rates that could impact retailers significantly.
Retail sales heated up in June, with both food and non-food performing well. The soaring temperatures increased sales of electric fans while sports and leisure equipment was boosted by both the weather and the start of Wimbledon.
The outlook is not all bright and sunny: retailers are watching Government closely for details of the upcoming business rates reform. If the Government includes shops within its new higher rates threshold, then many retailers will be forced to rethink their investment plans.
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