UK retail sales increase in January

Sales volumes rose 0.7% between January 2024 and January 2023 but were 1.3% below the pre-pandemic level recorded in February 2020. 

The increase recorded in January returned sales volumes to November 2023 levels following December’s fall.

Food stores sales volumes (quantity bought) rose by 3.4% over the month of January, recovering from December’s drop of 3.1%. 

Non-food stores sales volumes (the total of department, clothing, household and other non-food stores) returned to broadly expected levels, with a rise of 3.0% over the month.

The ONS attributed some of the decrease in December to shoppers buying Christmas gifts earlier, during the November Black Friday discounts. Additionally, 46% of surveyed adults reported plans to spend less on Christmas shopping because of the rising cost of living, according to the previously reported public opinion and social trends bulletin covering 29^th November-10^th December.

People spent more for less in January, according to the ONS, as the 3.9% monthly rise in sales values (amount spent) exceeded the 3.4% rise in sales volumes.

The amount of money spent online, known as online spending values, fell by 4.1% over the month to January.

Commenting on the data, Silvia Rindone, UK&I retail lead, EY, said: “January traditionally poses challenges for retailers as consumer budgets are stretched following the festive period, however after a record fall of 3.3% in December 2023, retail sales volumes rebounded by 3.4% in January, showing signs of a potential return to growth in 2024.

“While shop price inflation fell to its lowest in two years and food inflation dropped for the ninth consecutive month, consumers are yet to feel the benefit. Rising gas and electricity prices as well as the wet weather means many shoppers are still to be convinced to return to the high street.”

“During difficult times, retailers should continue to focus on getting the basics right whilst also adopting a growth and customer-focused mindset if they want to take advantage of potential growth later in the year. Promoting the right value proposition remains equally as important for brands and private labels as pricing remains the most influential decision driver for consumers.”