A masked woman waits at a bus stop on a deserted Oxford Street in London, Tuesday, March 24, 2020. … [+]
According to official data, UK retail sales saw their biggest fall on record in March due to the Coronavirus lockdown.
Whilst food sales have surged as consumers stockpiled and were forced to stay home, overall UK retail sales dropped by 5.1 percent in March according to the Office for National Statistics (ONS).
Hardest hit was the fashion sector with clothing sales seeing the largest drop with a reduction of minus 34.8 percent against the same period last year, despite the fact many of these stores were still open and trading until the official lockdown date of 23rd March.
Many fashion retailers are trying to boost sales with in-season discounts in excess of 60 percent on goods, further damaging their already fragile margins. Debenhams, Oasis and Warehouse group and Cath Kidston have already fallen into administration blaming the collapse in sales caused by Coronavirus restrictions and being forced to close their stores by governments.
Supermarkets and other food stores have seen a huge jump in sales with a 10.4 percent increase as consumers are forced to cook at home. With bars and pubs closed alcohol sales through these channels have seen a significant spike, up 31.4 percent.
Unsurprisingly online sales have soared as stores remain closed, now accounting for 22.3 percent of all UK retail sales – a record high.
Richard Lim, CEO, of research firm Retail Economics, said the impact of coronavirus was two-fold. Consumers can no longer visit stores and the economic impact is also seeing others significantly reduce spending.
“Retailers are in crisis mode as the impact of Covid-19 has obliterated sales to new record-lows. The immediate shock to our lives has forced new shopping behaviors and a focus on essentials. But worries about health, job security and prospects for the economy are causing some consumers to cut all non-essential spending and hibernate.”
“The trauma will be most acute for apparel retailers, who are desperately managing cash flow to try and keep working capital above the water,” he added.
The data for April is expected to continue this downward trend with analysts expecting a further drop of between 20 and 30 percent.
The ONS data covered the period from 1st March to 4th April.