Jewellery and watches sector drives retail sales in July

LONDON - DECEMBER 23:  Shoppers make their way along Oxford Street on December 23, 2006 in London, England. With just two days to go before Christmas, the streets are busy with people as they are finishing their last-minute Christmas shopping.  (Photo by Scott Barbour/Getty Images)

The jewellery & watches category topped the BRC-KPMG retail sales monitor’s growth rankings table in July.

The monthly report found jewellery and watches to be the best performing sector as both like-for-like and total sales increased in this category.

The sector also recorded its strongest growth since the monitor opened the jewellery and watches category in November 2014, despite being against its best performance of 2015, which had also included Eid.

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KPMG head of retail, David McCorquodale, says sales of jewellery and watches improved because international consumers took advantage of the weaker sterling to splash out on more expensive purchases.

The report also comments that this record growth in a luxury category is testament of the consumer’s continuing willingness to spend.

In addition, the British Retail Consortium (BRC) and KPMG Retail Sales Monitor found UK retail sales increased by 1.1% on a like-for-like basis from July 2015 and 1.9% on a total basis. This is the strongest growth since January.

On a three-month basis, total UK retail sales rose 1.1% in line with the 12-month average of 1.2%.

BRC chief executive Helen Dickinson comments:  “This month’s solid sales figures may come as a shock to some given the slew of early indicators suggesting that consumer activity was slowing in the wake of the referendum result. However, little has materially changed for most UK households in the wake of June 23, so it is not surprising to us that sales are simply responding to their normal underlying drivers. A heavy month of promotions proved very successful in appealing to bargain-hungry shoppers, boosting sales growth to 1.9 per cent, ahead of the 12- month average of 1.2 per cent.

“The big question for retailers is whether that success can be carried forward into full price sales. Whilst retailers continue to monitor the situation in the wake of Brexit, responding to rapid and complex change in consumer behaviour in the midst of a highly competitive market remains the substantive challenge. The industry is in the process of productivity-enhancing transformation, but Government needs to play its part to ensure that change is not suffocated by increasing costs.”

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