Retail sales volumes (quantity bought) are estimated to have risen by 0.2% in November 2024, following a fall of 0.7% in October 2024, according to the latest figures from the Office for National Statistics (ONS).
Growth in supermarkets and other non-food stores was partly offset by a fall in clothing retailers.
The official Black Friday was on 29 November 2024 and outside the November reporting period, which covers four weeks from 27 October to 23 November 2024. The ONS’s seasonally adjusted estimates account for this shift in timing.
Bogdan Toma, partner at McKinsey & Company, comments: “It was a flat picture for retail sales in November, notably excluding the Black Friday week, that will be included within the December read.
“November continues the flat trend in UK retail sales, with an overall marginal +0.2% increase.
“Grocery retail saw some positive gains while fashion and department stores declined. Both trends were likely impacted by seasonality shifts vs 2023, with Black Friday not captured in this reading, and a shift of the Half Term into November.”
“The notable aspect last month was the sharp decline in Online retail sales, by over 4%. This is spread across all online retail sectors, from food to fashion and household goods.
“The non-food online sales are also significantly affected by the ONS November reading not including Black Friday week this year, which will be fully reflected in December – we look forward to reviewing the full “golden quarter” results to be able to net this seasonality shift out.
“In this environment, retailers’ growth and profitability outlook continues to be challenged. The path forward requires a more flexible operating model and business planning, adapting to the shifts in demand, while also hedging with revenue streams that are less linked to the same dynamics, for example, retail media and financial services.”
Oliver Vernon-Harcourt, head of retail at Deloitte, said: “Despite Black Friday not being captured in November’s figures, retail sales returned to positive territory, with consumers opting for earlier Christmas shopping to get ahead. This will be a boost for the retail sector, albeit slightly below expectations, with grocery and certain non-food retailers seeing their positive results offset by a slump to clothing and online sales.
“With costs expected to rise for retailers in the first half of 2025, they will have a successful Golden Quarter at the top of their wish lists. This may be delivered if consumers spend more this Christmas than in recent years, lifted by their more positive outlook on personal finances and attractive discounted offerings.”
Lisa Hooker, PwC UK leader of industry for consumer markets, said: “There was a small headline rise in November’s retail sales, up 0.2% in value terms compared with this time last year, and seemingly reversing the weaker trend from the previous couple of months. Today’s figures showed notable upticks in grocery, furniture and speciality retail sales, although these were all against particularly weak comparatives in October.”
“However, these numbers should be interpreted with caution, as the reporting period this year ends one week prior to Black Friday unlike last year, and also includes the disruption caused by snow and Storm Bert in the second half of the month. The overwhelmingly online nature of Black Friday also meant that these figures showed a slowdown in ecommerce penetration, falling from 27.5% in October to 26.2% in this period, and reversing the trend this year, as shoppers waited for the best bargains to drop the week after reporting ended.””Not surprisingly, fashion continued to be the weakest category, with clothing retail sales falling by 8.1% in volume terms and 6.8% in value terms compared with last November, not helped by the combination of a relatively mild start to the month slowing demand for seasonal lines and shoppers holding off for Black Friday. This means that fashion retailers have seen volumes decline in all but one month since September 2023.”
“Overall, sales volumes remain muted and below pre-pandemic levels. However, given the exclusion of Black Friday from these results, they should not be taken as an indicator of wider retail performance in the run-up to Christmas. Other, more timely industry indicators as well as our own consumer research found greater interest in Black Friday this year, which would have boosted sales of fashion and electricals at the end of November, after the end of the reporting period.”
“The all-important final weeks in the run-up to Christmas are also looking rosier for the retail sector, with signs of consumer confidence settling post-Budget, higher disposable income compared with last year, and less disruption due to everything from the weather to industrial disputes. So we remain cautiously optimistic that December’s retail sales will outperform, in line with consumers’ expectations, with our own forecast suggesting that spending on presents and festivities will increase by 5% this year.”
Matt Jeffers, managing director, retail strategy & consulting at Accenture, said: “Retailers’ Christmas wishes have been granted early this year, as sales of food and household goods offset a decline in clothing sales and provided a much-needed boost after a difficult autumn.
“Despite the bad weather brought by Storm Bert, consumers flocked online, helping to offset lower footfall in store.
“With consumer confidence having improved ahead of Christmas, retailers are poised to capitalise on festive spending. Key opportunities lie in categories like beauty, fashion and toys, with retro-inspired, sustainable, and experiential gifts driving demand. Retailers must take advantage of this, by demonstrating value and attracting late Christmas shoppers through extended hours, click-and-collect services, and fast shipping.”
Silvia Rindone, EY UK&I Retail Lead comments: “November’s retail sales saw a marginal improvement of 0.2% from October, whilst year-on-year sales were also up by 1.9%
“The past few months have been tough for retailers. Subdued consumer sentiment due to ongoing economic pressures and uncertainty around the impact of the Chancellor’s autumn statement on personal finances have dampened sales at what should traditionally be the busiest period of the year.
“The November ONS data does not include Black Friday which will be covered in the December bulletin, however anecdotally, we saw considerable promotional activity leading up to and on Black Friday. The latest EY Holiday Shopping Survey found that 73% of consumers are sceptical of whether these promotions are genuinely saving them money so it will be interesting to see how this translates into sales next month, particularly for online sales volumes which saw a significant fall of 4.3% in November, the largest drop since March 2022.
“As we head into the new year, retailers will be monitoring whether to heavily discount in the Boxing Day and January sales to entice consumers back to the shops over the Christmas break. Latest EY data found that nearly half of consumers plan to wait for the festive sales, particularly for spend on clothing & accessories and technology & electronics. Over a quarter (29%) of consumers also plan to spend more this year on technology and electronics as they look to replace equipment bought during the pandemic. This could provide a welcome new year boost for retailers after what has been another challenging 12 months.”
