Overall UK retail sales for 2024 nudged up by 0.7% compared to 2023, but while food sales saw growth of 3.3%, non-food sales – including fashion – dropped by 1.5% for the year.
For the ‘golden quarter’, the three months up to and including December 2024, overall sales growth flatlined at 0.4% growth year-on-year, squeezing any real festive cheer out of UK retailers.
However, according to the latest data from the BRC-KPMG Retail Sales Monitor, covering the four weeks from 24 November – 28 December 2024, non-food sales increased by 4.4% year-on-year, against a decrease of 2.9% in December 2023.
That was largely driven by a rise of 11.1% in online non-food sales, compared to a decline of 0.8% in December 2023. Black Friday falling later in 2024 than it did in 2023 played a major factor with the figures.
The ‘online penetration rate’ (the proportion of non-food items bought online) increased to 39.6% in December from 37.2% in December 2023. That was above the 12-month average of 36.6%.
Meanwhile, in-store non-food sales increased by 0.4% year-on-year in December, against a decline of 2.9% in December 2023.
Helen Dickinson, CEO of the British Retail Consortium, said: “Following a challenging year marked by weak consumer confidence and difficult economic conditions, the crucial ‘golden quarter’ failed to give 2024 the send-off retailers were hoping for.
“Non-food was particularly hard hit, with sales contracting from the previous year. Food sales fared better over the Christmas period, ticking up slightly from the previous year, meanwhile beauty products, jewellery and electricals made a strong showing under the tree this year.
“While we project sales growth to average 1.2% in 2025, this is below the projected shop price inflation of 1.8%. This means volumes are likely to fall this year, all while the regulatory and tax burden on retailers will increase costs by £7 billion from rising National Insurance Contributions, increasing national living wage, confirmed in the Budget, and new packaging levies.
“With little hope of covering these costs through higher sales, retailers will likely push up prices and cut investment in stores and jobs, harming our high streets and the communities that rely on them. The Government must find ways to mitigate this, so that retailers can invest more in growth and jobs, starting with its planned business rates reform where it must ensure that no shop ends up paying higher rates than they do already.”
Linda Ellett, UK Head of Consumer, Retail & Leisure at KPMG, added: “With Black Friday falling as late as it did, this year it was part of the Christmas shopping season even more so than in previous years.
“December, coupled with Black Friday week at the end of November, delivered welcome sales growth for retailers. Computing and mobile phones, and beauty products, particularly saw sizeable jumps in sales both in-store and online, with the likes of AI-enabled tech and beauty advent calendars boosting festive takings.
“However, sales growth during the golden quarter of October to December was minimal, reflecting the ongoing careful management of many household budgets during a time when many costs remain at a heightened level compared to past years.
“In 2025, we will see retailers increasingly utilising customer data and AI technology to deliver increased personalisation when it comes to targeting products and offers to their current, and potential, customers.”
