Retail sales, Great Britain: June 2017

• In the 3 months to June 2017, the quantity bought (volume) in the retail industry is estimated to have increased by 1.5%, with increases seen across all store types.
• The growth for Quarter 2 (Apr to June) 2017 follows a decline of 1.4% in Quarter 1 (Jan Mar) 2017, meaning we are broadly at the same level as at the start of 2017.
• Compared with May 2017, the quantity bought increased by 0.6%, with non-food stores providing the main contribution.
• Feedback from retailers suggests that warmer weather in addition to the introduction of summer clothing helped boost clothing sales.
• Average store prices (including petrol stations) increased by 2.7% on the year following a rise of 3.2% in May 2017; the fall is a consequence of slowing fuel prices.
• Online sales (excluding automotive fuel) increased year-on-year by 15.9% and by 1.8% on the month, accounting for approximately 16.2% of all retail spending.

Commenting on today’s official retail figures, Kate Davies, Office for National Statistics Senior Statistician said:

“Today’s retail sales figures show overall growth. A particularly warm June seems to have prompted strong sales in clothing, which has compensated for a decline in food and fuel sales for the month.

"Looking at the quarterly data, the underlying trend as suggested by the three-month on three-month movement is one of growth, following a fall in quarter 1, suggesting a relatively flat first half of 2017."

This bulletin presents estimates of the quantity bought (volume) and amount spent (value) in the retail industry for the period 28 May 2017 to 1 July 2017. Unless otherwise stated, the estimates in this release are seasonally adjusted.

The Retail Sales Index (RSI) measures the value and volume of retail sales in Great Britain on a monthly basis. Data are collected from businesses in the retail industry and the survey’s results are used to produce seasonally adjusted monthly, quarterly and annual estimates of output in the retail industry at current price and at chained volume measures (removing the effect of inflation). Unless otherwise stated, all estimates included in this release are based on seasonally adjusted data.

The RSI is an important economic indicator and one of the earliest short-term measures of economic activity. It is used in the compilation of the national accounts and widely used by private and public sector institutions, particularly by the Bank of England and Her Majesty’s Treasury to assist in informed decision- and policy-making.

Summary information can be found in the Retail Sales Quality and Methodology Information report.

Table 1 shows the main retail sales growth rates for all retailing for both the value and volume of sales in June 2017.

In June 2017, both the amount spent (value) and the quantity bought (volume) in the retail industry increased.

The quantity bought increased by 2.9% compared with June 2016, the 50th consecutive period of year-on-year growth.

In Quarter 2 (Apr to June) 2017, the quantity bought increased by 1.5% following a decline in Quarter 1 (Jan to Mar) 2017.

Month-on-month, both the quantity bought and amount spent increased at a rate of 0.6% and 0.4% respectively.

From June 2013 the trend changes to one of strong growth, coinciding with falling prices. In January 2017, the quantity bought falls for 3 consecutive months for the 3-month on 3-month movement. This returns to growth in April 2017, while prices flatten.

The growth for Quarter 2 (Apr to June) 2017 follows a decline of 1.4% in Quarter 1 (Jan to Mar) 2017, meaning we are broadly at the same level as at the start of 2017.

As with all retail sales, the quantity bought in the clothing sector was relatively flat up to September 2013, while the amount spent increased with rising prices. As prices level out and remain flat from September 2013, increases seen in the value and volume are reflective of increased consumer demand in clothing.

Following a short period of growth between September 2013 and June 2015, the trend in clothing sales began to decline in June 2015, as with all retail sales (Figure 2).

From around March 2016, the amount spent and quantity bought becomes more volatile and while there is an upwards trend, this volatility somewhat masks this.

A more sustained period of growth in recent months has reduced this volatility. In June 2017, clothing sales for month-on-month, year-on-year, and 3-month on 3-month movements have all increased at 0.4%, 6.2% and 1.1% respectively. Feedback from retailers suggests that growth in this month is a consequence of warmer temperatures coinciding with the introduction of summer clothing.

Clothing is one of the main sectors affected by weather, where unseasonal weather effects sales more than seasonal weather. However, the relatively recent poor performance in this industry has meant that the warmer summer weather in June 2017 has had a positive effect.

Month-on-month there was an increase in the quantity bought for all sectors, except predominantly food stores and fuel, which demonstrated a decline of 0.5% and 2.0% respectively.

The monthly picture, as shown in Figure 3, indicates that the largest contribution to the growth in both quantity bought and amount spent came from non-food stores. Figure 3 illustrates that non-essential items have done well in June 2017, while the essential items such as food and fuel have seen falls on the month. However, some caution should be taken when looking at one month’s figures.

The overall growth of 5.7% in amount spent can be attributed to the growth seen within all sectors (Table 3).

Excluding predominantly food stores, all other main sectors within the retail industry increased in the quantity bought when compared with June 2016.

The quantity bought in food stores decreased by 0.4%; this is the lowest since July 2014, which decreased by 1.4%. In contrast, the amount spent within predominantly food stores increased to 2.1%. The average store price within predominantly food stores continued to grow at the same rate as May 2017, at 2.5% year-on-year.

Internet sales are estimates of how much was spent online through retailers across all store types in Great Britain.

In June 2017:

• average weekly spending online was £1.1 billion; an increase of 15.9% compared with June 2016
• the amount spent (value) online accounted for 16.2% of all retail spending, excluding automotive fuel, compared with 16.0% in May 2017

The only international estimate of retail sales available for June 2017 was published by the US Census Bureau on 14 June 2017. In their advanced retail trade estimates for June 2017, they include the amount spent in the US retail industry, including motor vehicles and parts and food services.

Eurostat also published their latest estimates of the volume of retail trade across the EU on 6 June 2017 for April 2017. This shows the seasonally-adjusted volume of retail trade in both the euro area (EA19) and EU28 when compared with March 2017.

Data for Northern Ireland are published by the Northern Ireland Statistics and Research Agency (NISRA).

It should be noted that accurate comparisons cannot be made against these or other international statistics due to a variety of reasons, including differences in methodology.

Our Monthly Business Survey (MBS) for retail sales measures output from the retail industry in Great Britain. It samples 5,000 businesses, with all businesses employing over 100 people or with an annual turnover of more than £60 million receiving an online questionnaire every month.

Further qualitative data or information and summary tables can be found in the attached datasets. This includes data on:

• response rates
• standard errors
• revision triangle
• distribution analysis

The Retail Sales Quality and Methodology Information report contains important information on:

• the strengths and limitations of the data and how it compares with related data
• uses and users of the data
• how the output was created
• the quality of the output including the accuracy of the data