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Online Orders Powered August’s 3.9% UK Retail Sales Growth

U.K. retail sales in August rose 3.9 percent, according to a tracking report from the British Retail Consortium and KPMG.

The latest data from the BRC-KPMG sales monitor shows an uptick for August, versus down 0.4 percent a year ago, and indicates that retail sales grew for the third consecutive month. The growth was attributed to continued growth in online orders, which have been on the upswing since the pandemic struck. Online non-food orders were up 39.3 percent in August, versus 29 percent a year ago.

In a separate report from BRC-ShopperTrak data on Friday, U.K. footfall fell 34.8 percent in August, below the 12-month average decline of 27.6 percent. High street footfall, which fell 41.7 percent year-on-year, was the worst-performing location in August, falling below shopping centers for the first time since April 2018. Retail parks saw a smaller 11.1 percent year-on-year decline in footfall, thanks to their locations in wider, open spaces. In contrast, shopping center footfall fell 37.4 percent year-on-year.

“Footfall remained well below normal levels in August. In-store discounting and demand for school wear helped lure some customers back to the shops, but with many office blocks still empty and much of the public avoiding public transport, footfall is not returning to towns and city centers and this is having a devastating effect on the local economies in these areas,” said Helen Dickinson, OBE, CEO of the BRC.

According to Dickinson, the future of retail sales in unclear. “While many businesses have been investing in making workplaces safer, we are unlikely to see significant growth in footfall while government advice remains to ‘work from home if you can.’ Unless this changes, more should be done to encourage people to travel and reassure them that public transport is safe,” she said. “Government should also recognize that, while footfall is so low, many businesses will not be able to manage their fixed costs—rent & business rates in particular—and unnecessary job losses and store closures will follow.”

As for the August sales report, Dickinson said remote working has helped sales in home goods, while the lockdown seems to have permanently changed some consumers’ shopping habits. The prolonged shift to working from home has also devastated many city center retailers, she added, as retailers that rely on high footfall locations, such as apparel, footwear and beauty, continue to struggle.

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Other retailers are looking at how to better serve their customers, such as capturing some market share in the food delivery sector. Marks & Spencer joined forces with Ocado to begin online food delivery. That service was supposed to start on Sept. 1, but customers saw first-day scheduled deliveries canceled the night before as the retail venture underwent some growing pains.

U.K.’s Office for National Statistics will post its official August retail sales report on Sept. 18.