Retail sales grow strongly in year to October

Retailers reported a strong rise in sales volumes in the year to October and expect that growth will continue at a similar pace next month, according to the CBI.

In the CBI’s latest monthly Distributive Trades Survey, covering the first two and a half weeks of October, 47 percent of retailers reported that sales volumes were up on a year ago and 17 percent stated that sales had fallen. The resulting balance of +30 percent well exceeded expectations (+15 percent), and was the fastest rate of sales growth since June (+42 percent). Looking ahead, retailers expect growth in sales volumes to be similarly robust in the year to November (+27 percent).

In line with rising sales, the volume of orders placed on suppliers increased moderately (+ four percent), compared to expectations of being flat (- two percent).

Despite the second consecutive month of sales growth, high-street retailers still considered the volume of sales to be below average for the time of year (- seven percent). However, sales were below seasonal norms to the least extent since April (0 percent), and the survey balance was a little better than expected (-11 percent).

There was solid growth in a number of individual retail sectors. Clothing and furniture and carpets reported the greatest year-on-year increases in sales (+57 percent and +58 percent respectively), with the clothing sector posting the first sales growth since July (+56 percent). Grocers also reported a rise in year-on-year sales volumes for the sixth month running (+33 percent), and the footwear and leather sector remained strong, with sales increasing (+39%) for the seventh consecutive month.

Elsewhere, wholesalers saw a slight fall in sales volumes on a year ago (- six percent), despite expectations of modest growth (+ six percent), and sales are expected to continue falling in November (- six percent).

Meanwhile, the motor trades sector saw the first year-on-year rise in sales volumes (+ four percent) since March, surpassing expectations of a decline (-20 percent) although sales are expected to fall once again next month (-19 percent).