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September retail sales see biggest quarterly increase on record

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Retail sales volumes in September increased for the fifth month in a row while on a quarterly basis, they saw the biggest quarterly increase on record, according to official statistics.

Retail sales volumes increased 1.5% when compared with August and by 5.5% when compared to February’s pre-pandemic level.

In the three months to September, retail sales volumes increased 17.4%, the biggest quarterly increase on record as sales picked up from their record lows earlier in the year.

According to the Office for National Statistics (ONS), food sales have “done well” in recent months as people scaled back dining out, while non-food store sales made a 1.7% recovery above their February level.

However, the ONS noted that fuel sales in the month were still 8.6% below February’s figure as many people continued to work from home. Further, clothing sales volumes were also 12.7% below typical levels seen before the onset of the pandemic.

But sales in the home improvement sector continued to rise, as did online sales with 27.5% of all sales done via the web, compared to 20.1% in February.

Christmas party season cancelled

Susannah Streeter, senior investment and markets analyst at Hargreaves Lansdown, said the retail recovery shows just how dramatically the crisis has changed the shape of the industry.

“The pandemic has revolutionised the way we shop, as more consumers have switched to online stores and opt for click and collect services from the high street. With restaurant dining curtailed, due to social distancing and the 10pm curfew, the food and grocery sector is profiting with sales volumes in food stores 3.7% higher in September than before the pandemic.

“Rather than switch back to old habits, consumers seem to have embraced the transition to online. While there was a small decrease in online purchases across all sectors in September, they still represent 27.5 % of all sales, a significant step up from February when we ordered just 20.1% online.”

However, she added it’s still “extremely tough” for the fashion sector, as clothing sales in September were still 12.7% below pre-pandemic levels.

Streeter added: “With the Christmas party season cancelled and little need to refresh wardrobes there seems to be a reduced appetite to invest in new seasonal styles.

“City centres remain quiet, with many people working from home, which has had a severe impact on shops in streets that used to be crowded with workers. Overall footfall is 70% below the pre-pandemic level, but retail parks – where parking is abundant and social distancing restrictions easier to observe – have fared better.

“DIY seems to have become a national pastime as sales of home improvement products in particular continue to do well. People are clearly continuing those projects which they began or planned in lockdown, with sales in household goods stores increasing by 11% compared with February.”

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