Related Searches: Tea Vitamin Nutrients Ingredients paper cup packing

Food & Health Ingredients
Health & Nutrition
Processing & Packaging
Starch & Starch Derivatives
You are here: Home >news >UK retailers suffer worst Christmas in 10 years as Brexit looms, but food offers respite

UK retailers suffer worst Christmas in 10 years as Brexit looms, but food offers respite

2019-01-14 foodingredientsfirst

Tag: Brexit retailers Christmas


UK retailers have experienced the worst Christmas trading in a decade as sales plummeted during the last festive season before Brexit. Consumers remained cautious despite many of the retailers slashing prices in a bid to encourage spending. However, the food category did show a slight uptick. Supermarket Tesco also defied the trend by posting a trading updat with like-for-like sales over Christmas rising 2.2 percent in its UK stores compared with the same period last year.

Suffering the worst Christmas trading since the beginning of the financial crisis in 2008 comes at a time of growing uncertainty within the British retail landscape. It comes just weeks before the Brexit deadline of March 29, the current date the UK is due to leave the European unio (EU).

The retail and food industry – and the rest of the world – will be watching next Tuesday’s Brexit vote closely as MPs decide whether to accept or reject Prime Minister’s Theresa May’s deal that has already been agreed with the EU. All expectations are for it to be rejected in Parliament due to massive opposition among staunch Brexiters within the Conservative Party and other remainers from across the board. May called off the first scheduled Withdrawal Agreement last month at the eleventh hour after realizing it would have been rejected by a significant margin.

The British Retail Consortium (BRC) has been calling for clarity for some time and claims that a “no-deal” Brexit will lead to severe price hikes.

And the worst December sales performance in ten years means more tough times ahead for the UK’s retail industry, signaling a challenging start to 2019 for retailers. It also compounds a long period of uncertainty and confusion within the industry as the UK is still to agree a Brexit deal. 

On a total basis, sales were a flat 0.0 percent in December, against an increase of 1.4 percent in December 2017, according to data from KPMG and the BRC which cover the five weeks 25 November-29 December 2018. This is the lowest growth since April, excluding Easter distortions. It is below the three-month and 12-month averages of 0.5 percent and 1.2 percent respectively.

In December 2018, UK retail sales decreased by 0.7 percent on a like-for-like basis from December 2017, when they had increased 0.6 percent from the preceding year. The 12-month average for 2018 saw sales rise by 1.2 percent on a total basis. This was comprised of a 3.1 percent increase in food sales and -0.3 percent in non-food sales on a total basis.

Over the three months to December, food sales increased 0.6 percent on a like-for-like basis and 1.8 percent on a total basis. This is below the 12-month Total average growth of 3.1 percent. Over the same period, non-food retail sales declined 1.2 percent on a like-for-like basis and 0.4 percent on a total basis. This is below the 12-month total average decrease of 0.3 percent. December non-food sales experienced a decline.

“Squeezed consumers chose not to splash out this Christmas with retail sales growth stalling for the first time in 28 months. The worst December sales performance in ten years means a challenging start to 2019 for retailers, with Business Rates set to rise once again this year, and the threat of a No-Deal Brexit looming ever larger,” says BRC CEO, Helen Dickinson. 

“The retail landscape is changing dramatically in the UK, while the trading environment remains tough. Retailers are facing up this challenge but are having to wrestle with mounting costs from a succession of government policies – from the Apprenticeship Levy, to higher wage costs, to rising business rates.”

“Retail makes up 5 percent of the economy, yet pays 10 percent of all business taxes and 25 percent of all business rates. This is neither fair nor sustainable. The Government should urgently look into reforming the broken business rates system and champion the future of retail in the UK,” she adds.

“Retailers experienced little festive cheer this year, with total sales in December delivering zero growth on last year,” adds Paul Martin, UK Head of Retail, KPMG. “This comes despite some retailers desperately attempting to generate sales through slashed pricing, which has seemingly not been enough to encourage shoppers.”

“Growth in food did provide a glimmer of hope, being among the few categories to notice an uptick. However, the continued contrast in performance between the high street and online remained evident in December – albeit 2018 did also see a continued slowdown in online retail sales.

“The first months of 2019 will unlikely hold much improvement. As many retailers report their festive trading performance, the list of winners and losers will become clear, but winning means more than just improving sales. Retailers have to protect their margins in order to deliver a profitable festive season.”

Jon Woolven, Strategy and Innovation Director at IGD, an education and training charity for the food and grocery industry, adds: “Despite the challenges elsewher in retail, the grocery sector enjoyed a positive December, with an increase in sales on the previous year broadly in line with inflation.”

“The desire to indulge over Christmas prevailed once more and seven in ten shoppers said they spent extra on higher quality food last month. However, that mood appears fragile with only 20 percent of shoppers expecting to be better off financially over the next twelve months, the lowest level of confidence by this measure since June 2017,” notes Woolven.

UK retailers post trading updates
For the 13 weeks to November 24, 2018; Christmas period: 6 weeks to 5 January 2019, Tesco reported a “strong Christmas benefiting from an increasingly competitive offer for customers.” UK & ROI Christmas LFL sales +2.6 percent, outperforming the market in UK in both volume and value terms. Quality and value perception both up significantly year-on-year: +3.5pts and +4.5pts respectively. There was market outperformance in all key categories, including food.

In a trade updat posted on January 8, high-end UK grocer, Waitrose, said total sales excluding fuel were up 7.5 percent compared to the same week last year with the trading week boosted by the additional day of sales in the run-up to New Year’s Eve.

“Customers were in celebratory mood as Champagne and sparkling wines sales grew by 48 and 27 percent respectively on last year. Spirit sales were strong with liqueurs up 45 percent, imported whiskey up 38 percent, Tequila up 37 percent, Cognac up 36 percent, vermouth up 34 percent and gins up by more than 31 percent. Party food sales were also up 86 percent,” says the statement.

Last week, Waitrose also launched its vegan fish “less” fingers, which are proving popular with customers, helping sales of its vegan and vegetarian ranges increase by 110 percent. 

Marks & Spencer saw its sales dro over the holiday period with like-for-like sales down 2.2 percent in the 13 weeks to 29 December. Food sales decreased 2.1 percent. 

M&S Chief Executive, Steve Rowe, remains upbeat. “Against the backdro of well-publicized difficult market conditions our performance remained steady across the period,” he says. “Our Food business traded successfully over Christmas as customers responded to improved value.”

Posting its third-quarter trading statement, Sainsbury’s said total retail sales were down 0.4 percent (excluding fuel) with like-for-like sales down 1.1 percent (excl. fuel). But, grocery sales grew 0.4 percent with Groceries online and Convenience up 6.0 percent and 3.0 percent respectively. General Merchandise sales declined by 2.3 percent and clothing sales declined by 0.2 percent.

“Sainsbury’s is focused on offering distinctive food at great prices. Grocery sales were solid across the quarter and our price position versus our competitors improved,” Mike Coupe, Group Chief Executive concludes.


Editors Note:

To apply for becoming a contributor of,

welcome to send your CV and sample works to us,



Subscribe to our e-newsletter for the latest food ingredients news and trends.


SJGLE B2B Website : 中文版 | ChineseCustomer Service: 86-400 610 1188-3 ( Mon-Fri 9: 00-18: 00 BJT)

About Us|Contact Us|Privacy Policy|Intellectual Property Statement

Copyright 2006-22 Shanghai Sinoexpo Informa Markets International Exhibition Co Ltd (All Rights Reserved). ICP 05034851-121

Inquiry Basket

Inquiry Basket

Buyer service

Buyer service

Supplier service

Supplier service