The retail sector has continued its strong start to 2022 by recording its thirteenth consecutive month of like-for-like sales, new figures by accountancy and business advisory firm BDO LLP reveal.
According to BDO’s High Street Sales Tracker, total like-for-like sales, combined in-store and online, increased by +60.9% in March from a base of +42.5% for the equivalent month in 2021.
Total non-store like-for-like sales fell by -10.8%, marking three months of decline for non-store like-for-like sales. This is in stark contrast to March 2021, when non-store like-for-like sales reached +157.2% during the third national lockdown.
Both fashion and lifestyle categories saw substantial increases in their total like-for-like sales, however, homewares saw its first fall since April 2020. The first week of the month saw growth of +48.31% from a base of +4.53% for the same week the previous year, and the second and third weeks of the month saw increases of +60.87% and +94.31% respectively. In the final week of March, total like-for-like sales rose by +76.13%, from a +131.54% base for the same week in 2021, when the government’s ‘Stay at Home’ order officially ended.
Sector Results
The fashion sector saw the biggest growth, with total like-for-like sales increasing by +87.0% for the month, from a base of +57.5% for the same time last year. Fashion was the only category to record positive non-store results in March, which contributed to positive total LFLs for fashion for the thirteenth consecutive month.
Total like-for-like sales in the lifestyle sector increased by +71.4% in March, from a base of +14.7% for the equivalent month last year. However, the sector saw a significant fall in non-store like-for-like sales, falling from the highs recorded in lockdown last year.
Homewares total like-for-like sales fell by -9.6% in March, from a base of +112.6% in the same month last year. This is the first time that the category has recorded a drop in sales since April 2020, recording negative LFLs in every week of March.
Sophie Michael, Head of Retail and Wholesale at BDO LLP, said: “Our results in March have highlighted that consumer spending remains high despite impending increases to the cost-of-living this month. However, there are also concerning signs that some of this spending is being supported by record levels of household borrowing, which has increased lately even as consumer confidence plummets. There may be good reason to expect some pull-back in discretionary spending over coming months, though the impact will inevitably vary across different areas of retail.
“Rising energy, operational and supply costs also pose a serious challenge for retailers, many of whom may look into raising prices and/or re-examining their supply chains, as they seek to mitigate these issues and make cutbacks where possible. While the cost-of-living crisis was largely still on the horizon in March, retailers have been planning ahead and have made allowances for higher levels of inflation. However, the forecasts only appear to be increasing so the question is whether costs will rise faster than initially anticipated and cause further disruption.
“This myriad of issues will no doubt require retailers to reconsider their plans as the consumer purse comes under increasing pressure.”
