Retail prices stay low despite rising costs

Retail prices have stayed low despite coronavirus-forced rising costs.

Non-Food prices fell sharply by 3.7% in April compared to a decline of 1.9% in March.

This is below the 12-and 6-month average price declines of 1.6% and 2.0%, respectively – the highest rate of decline since the British Retail Consortium’s series began in December 2006.

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Commenting on the data, Helen Dickinson OBE, chief executive of the BRC, said: “Overall, Shop Prices fell in April, with a larger drop in Non-Food prices outweighing the rise in Food inflation. Food retailers offered fewer promotions this April as they worked to discourage the consumer stockpiling of the previous month, pushing food inflation slightly above average.

“In contrast, some Non-Food sectors, particularly Clothing and Footwear and Furniture, were hard hit, as discretionary spending evaporated, resulting in deep price cuts.”

She added: “Retailers who remain open face rising costs from implementing social distancing measures, protective equipment and rising import prices, yet they continue to deliver great value on their products. With the UK facing months of economic uncertainty and the prospect of rising job losses, many customers have cut right back on spending.

“A speedy economic recovery is key to rebuilding consumer confidence, but businesses cannot do it alone. The Government has demonstrated great support for the industry and they must be ready to take measures to revive consumer demand after lockdown has lifted.”

 While Mike Watkins, head of retailer and business insight at Nielsen, added: “With lockdown effectively closing the high street, non-food retailers are reliant on online sales and prices have fallen as they look to sell stock.

“Across the supermarkets, there has been a reduction of promotions to help availability as well as some supply chain constraints, which has led to a small increase in shop prices primarily in ambient foods. With such a significant disruption to shopping behaviour, the industry continues to do a marvellous job in helping to feed the nation in these difficult times.”

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Alex Douglas

The author Alex Douglas

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