Jun 6, 2023
Reading time
3 minutes
Download the article
Click here to print
Text size
aA+ aA-

UK May fashion spend is weak say Barclays and BRC

Jun 6, 2023

UK retail and consumer spending was sluggish in May, two reports showed on Tuesday, with the latest figures from the British retail Consortium and from Barclays offering up bad news for the fashion sector.

Photo: Sandra Halliday

Looking at the wider story first, both the BRC-KPMG Retail Sales Monitor and the monthly Barclays report showed weak sales rises that lagged inflation.

The Barclays figures take in consumer spending in general (rather than just retail) and are also isolated to spending on payment cards, But given the massive presence of Barclays in the market, its figures do reflect the broader picture very strongly.

The finance giant said consumer card spending grew just 3.6% in May and spending on non-essential items rose just 3% “due to consumers cutting back to manage household bills, while inconsistent weather hampered spend on clothing”.

Consumers told it they’re cutting down on discretionary spending to cope with rising household bills. But Barclays also cited “the unseasonal and inconsistent weather in May” that led Britons to “hold off from making new summer wardrobe purchases”. As a result, clothing saw its largest decline in over two years (-5.1%), while department stores (+1.9%) experienced their smallest uplift since November 2022. Meanwhile, discount stores enjoyed growth of 5%, in another sign that consumers continue to seek value wherever possible.

This came as a hefty 26% of shoppers said they’re cutting back on buying new summer clothes due to the rising cost-of-living, and 35% plan to re-wear more of their old summer clothes for the same reason. 

It was a similar story from the BRC-KPMG Retail Sales Monitor. This showed UK total retail sales up by 3.9% in May, against a decline of 1.1% in May 2022. That latest figure isn’t adjusted for inflation, which is running in double digits.

Switching to the three months to the end of May, food sales rose 9.6% but non-food sales didn't go anywhere close to keeping pace with inflation with a rise of only 0.7% in total and 0.5% on a like-for-like basis.

Non-food sales in-store were a little better with a 2.9% rise in total and 2.2% like-for-like, but sales online were down 3%. 

Health & beauty sales were one of the rising categories in May (both in-store and online), but footwear, clothing, and jewellery & watches all declined, although the BRC didn’t say by how much.

Yet despite the weak month for the fashion sector, the chief executive of the BRC, Helen Dickinson, did highlight that the end of the month saw an improvement as the weather brightened up. 

“There was cause for some optimism as brighter weather led to a much-needed pick-up in summer fashion sales,” she explained.

That said, even with warmer weather, spurring sales of summer items, consumers also have to take other priorities into account and this may continue to suppress sales.

Paul Martin, UK Head of Retail at KPMG, said: “UK consumers are resilient, but with stubbornly high food inflation continuing and the prospect of further interest rate rises threatening to impact their ability to spend elsewhere, it is likely to be a long, hot summer for the retail sector.”

Copyright © 2023 FashionNetwork.com All rights reserved.