Total food sales increased by 8% last month, despite retailers across the sector facing the pressures of “January blues,” new data shows.
According to the BRC-KPMG retail sales monitor, like-for-like sales across the food category rose by 7.9% over the three months to January, with food in growth year on year above the 3.5% 12-month total average growth.
However, total UK retail sales rose by 4.2%, less than half of the 11.9% increase at the same time in 2022.
“As Christmas cheer subsided, retailers felt the January blues as sales growth slowed,” BRC chief executive, Helen Dickinson said.
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“Many retailers discounted heavily to entice consumer spend and, while there were bargains to be had in the January Sales, retailers continue to be hit by lower margins and falling volumes.”
She said that own-brand ranges “remain popular across food and non-food products”, with customers trading down on big-ticket items.
“The coming months will continue to be challenging for retailers and their customers. Consumer confidence remains stubbornly low and looming rises in household bills and mortgages mean discretionary spending will remain weak.”
“With ongoing cost pressures and labour shortages, increases in sales don’t convert into increases in profits or cash.”
Dickinson added: “Given that backdrop, retailers can ill afford the millions lost to the inflexibilities of the apprenticeship levy, so the government must urgently look to change the system so retailers can use the funds to train their workforce to better meet the needs of their businesses and the people who work in them.”
This comes as retail trade unions have urged the UK government for urgent reform to the apprenticeship levy system if it wants to unlock economic growth.
Unions including UK Hospitality, TechUK and the Recruitment & Employment Confederation (REC), have slammed the government for “holding back investment” in training.
