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Barbenheimer bounce only bright spot as UK retail sales fall in soggy July

Nick Cheek
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Nick Cheek

UK retail sales are estimated to have fallen by 1.2% during one of the wettest Julys on record, with the releases of summer blockbuster films Barbie and Oppenheimer offering the only ray of sunshine for retailers.

After the surprising rise in sales volumes in June, the Office for National Statistics (ONS) revealed a drop for July, as poor weather kept shoppers away from the high street.

This led to 27.4% of retail sales taking place online, a 1.4% rise from June, which was the highest proportion of online sales since February 2022.

Food store purchases fell by 2.6% in July, with supermarkets reporting a decrease in sales for clothing and food products, as the increased cost of living and food prices continued to affect sales volumes.

The wet weather reduced footfall for many shops which led to non-food stores sales volumes falling by 1.7%, following a rise of 0.6% the previous month.

Rainfall blamed for drop in footfall

Non-store retailing sales volumes rose by 2.8% in July 2023 thanks to a range of promotions boosting figures.

After the sixth wettest July on record, experts noted that it was perfect timing for Brits to flock to the cinema and restaurants to spend their cash.

Entertainment sales saved by ‘Barbenheimer’ releases

Jon Boland, general manager of data firm Clover said: “There’s no doubt that the school summer holidays are driving where consumers spend their money as they look to treat the kids and keep them busy.

“We saw signs of a “Barbie Bounce” in entertainment sales, with families flocking to the cinema given the publicity surrounding the Barbie and Oppenheimer films.

“Pubs and restaurants also fared well, likely driven by post-cinema treats and offering respite from the heavy rain. However, it’s clear we are still in a cost-of-living crisis.”

Helen Dickinson, chief executive of the British Retail Consortium, commented: “Retailers are hopeful that the coming months will provide a boost to spending, as England fans celebrate the Women’s Football World Cup Final this weekend, families start their back-to-school shopping and university students ready themselves for the new academic year.

“Nonetheless, the economic backdrop will remain difficult, and Government must find ways to create an environment that fosters economic growth.”

 Lionesses could roar retail sales up

Danni Hewson, head of financial analysis at AJ Bell, reflected: “July’s retail slump follows three positive months for the sector and there is every indication that consumers do still have cash to spend, they’re just choosing where and when to spend it very carefully.

“With ‘Barbenheimer’ offering something for everyone at the cinema and Mecca Bingo owner Rank updating markets to say they’d enjoyed a big spike in revenues since the showers began, it seems people took the opportunity to splurge on experiences rather than stuff.

“A bit more sunshine and the potential of a World Cup victory is likely to re-frame the numbers.”