Retail sales, Great Britain: March 2019

• In the three months to March 2019 (Quarter 1), the quantity bought in retail sales increased by 1.6% when compared with Quarter 4 (Oct to Dec) 2018, following sustained growth throughout the first three months of the year.

• All store types except department stores and household goods stores increased in the quantity bought in the three months to March 2019, when compared with the previous three months.

• The quantity bought in March 2019 increased by 1.1% on the month, with food stores and non-store retailing providing the largest contributions to this growth.

• Year-on-year growth in the quantity bought increased by 6.7% in March 2019, the highest since October 2016, with a range of stores noting that the milder weather this year helped boost sales in comparison with the “Beast from the East” impacting sales in March 2018.

• Department stores were the only store type to decrease in the quantity bought when compared with March 2018, with a fall of 0.3% in March 2019.

• Online sales as a proportion of all retailing increased to 18.6% in March 2019, from the 18.1% reported in February 2019.

This bulletin presents estimates of the quantity bought (volume) and amount spent (value) in the retail industry for the five-week period 24 February 2019 to 30 March 2019.

This period a year earlier (25 February 2018 to 31 March 2018) included the run up to Easter Sunday, which fell on 1 April 2018. Our seasonal adjustment methodology removes the impact of these events to produce more comparable estimates.

Unless otherwise stated, the estimates in this release are seasonally adjusted.

Retail sales collects turnover data from retailers, which is money through the till before any deductions, including refunded items. This provides us with the best indicator for consumer spending during the reference period.

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 price changes).

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 RSI Quality and Methodology Information report.

In March 2019, estimates for both the amount spent (value) and quantity bought (volume) in retail sales showed strong growth across all measures (Table 1). When compared with the previous month, the amount spent increased by 1.2% and the quantity bought increased by 1.1%.

When compared with a year earlier, March 2019 showed strong growth at 7.3% for the amount spent and 6.7% for the quantity bought. This strong growth can be explained by the bad weather experienced in March 2018, as discussed in the March 2018 retail sales bulletin. The Met Office summary for March 2018 said that “March 2018 began with an exceptionally cold easterly flow and widespread snow, and daytime temperatures remained below freezing in many parts of the country” and reported on the numerous road closures affecting travel across the country.

Looking at these measures over time provides a clearer picture as to what is happening in the retail industry (Figure 1).

Figure 1 shows the quantity bought in retail sales over time for both the rolling three-month on three-month and the month-on-month movement.

While both series show a general increase in retail sales, the monthly path shows more volatility than the smoother three-month on three-month series.

Earlier in the series, from March 2016, sales were increasing at a steady rate until late 2016 when a short period of contraction is seen in the three months to March 2017. From April 2017, sales began to recover and increase steadily, albeit at a slower rate. From January 2018, the quantity bought began to level for a short period until May 2018 when a faster rate of growth is seen during the summer of 2018; partly attributed to consecutive months of hot weather in June, July and August.

Towards the end of 2018 there was a general slowdown to growth up to 2019, where we see consecutive monthly increases and resulting in robust growth in the three months to March 2019 at 1.6%.

Figure 2 shows the contribution to month-on-month growth, with the amount spent at 1.2 percentage points and the quantity bought at 1.1 percentage points.

Food stores was the largest contributor towards the increase for the amount spent at 0.5 percentage points. Food stores and non-store retailing were both the largest contributors to the quantity bought at 0.4 percentage points.

The quantity bought for fuel remained flat on the month, while the amount spent provided a small contribution of 0.1 percentage points.

In March 2019, all four main sectors contributed positively to the amount spent and quantity bought, resulting in a year-on-year growth of 7.3 and 6.7 percentage points respectively. The milder weather in March 2019 is likely to have helped boost sales in comparison with the bad weather experienced in March 2018, which resulted in many road closures (see the March 2018 retail sales bulletin).

Fuel was the smallest contributor to growth in the amount spent, and to the quantity bought, at 1.4 and 1.1 percentage points respectively.

Non-store retailing provided the largest contribution to the growth in the amount spent at 2.3 percentage points. Similarly, non-store retailing reported the largest contribution to the quantity bought at 2.4 percentage points in March 2019.

The quantity bought in retail sales increased by 6.7% in March 2019 when compared with March 2018, with increases in all store types except department stores (Table 2).

Anecdotal evidence from a range of store types supported the notion that the mild weather in March 2019 boosted sales, particularly in comparison with the adverse weather experienced from the “Beast from the East” in March 2018.

Showing a different picture, department stores were the only store type to show a decline on the year. This decline has been the general trend for department stores as seen in Figure 4.

Figure 4 shows the year-on-year growth rates in the quantity bought for both all retailing and department stores.

Both series follow a similar pattern from March 2018 to May 2018, reporting moderate growth in March and April 2018, followed by a stronger rate of growth in May 2018. From June 2018, department stores diverged from the strong growth seen in total retail with a continued slowdown to growth until September 2018. In contrast, all retailing remained relatively stable throughout this period.

In October 2018, both all retailing and department stores reported growth, but all retailing dropped to 2.2% from the steady trend and department stores showed an increased growth from the slowdown.

Following this period, both still reported growths until December 2018. Department stores took a downturn in January 2019 to negative 1.0%, the opposite to all retailing, which showed growth of 4.0%. Subsequently, department stores continued to follow a downward trend while all retailing reported strong growth of 6.7% in March 2019. This shows that while the quantity bought in department stores is decreasing, other store types are contributing positively to the overall growth in retail sales.

Table 3 shows the month-on-month and year-on-year growth rates for online retailing, by sector, in addition to the proportion of online sales to all retail sales for non-seasonally adjusted data. The percentage weights indicate where money is spent online.

Internet sales increased by 12.4% for the amount spent in March 2019 when compared with March 2018, with all sectors showing growths except food stores and household goods stores. The month-on-month picture showed a similar trend with total growth of 8.0%.

Online sales as a total of all retailing increased to 18.6% in March 2019, increasing from the 18.1% reported in February 2019 (see Figure 5).

Figure 5 displays internet sales as a proportion of all retailing over the past year for non-seasonally adjusted sales to include seasonal spending.

Throughout 2018, the proportions remained relatively stable with a slight dip to August at 16.8%. Proportions soon recovered increasing to 18.1% in October 2018. In November 2018, the proportion of all retailing (excluding fuel) spiked to 21.6%, which can be expected with Black Friday, Cyber Monday and Christmas sales.

Internet sales as a proportion of all retailing then showed a decline to February 2019, where 18.1% of all retail was spent online. Following this, March 2019 has shown an increase and is at a higher proportion than March 2018.

The most recent international estimate of retail sales available for February 2019 was published by the US Census Bureau on 1 April 2019. In its advanced monthly sales for retail and food services, November 2018 (PDF, 1.6MB) 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 (PDF, 501.9KB) across the European Union on 3 April 2019 for February 2019. This shows the seasonally adjusted volume of retail trade in both the euro area (EA19) and EU28 when compared with January 2019.

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