The Office for National Statistics (ONS) data has shown that UK retail sales were flat last month after a decline in August, with volumes in the three months to September up 0.6% on the previous quarter. An increase in online sales in July was largely responsible for the growth. Sales were up 3.1% year-on-year in September, up from the 2.7% year-on-year increase recorded in August. The statistics for last month lead some analysts to conclude that poor business confidence is spreading to the consumer sector. This comes as employment reaches near-record highs and real wage growth increases.

In the three months to September 2019, moderate growth in the quantity bought continued at 0.6% when compared with the previous three months, with all sectors within non-food stores reporting declines except ‘other stores’.

ONS Head of Retail Sales Rhian Murphy said “Retail sales growth remained steady in the latest three months, following strong summer online sales. Food shops bounced back after a weak few months, but there was yet more bad news for department stores with sales continuing to fall in September.”

Federation of Small Business (FSB) National Chairman Mike Cherry said “The latest retail sales figures reflect a difficult year for the sector, and demonstrate the struggles our high street firms are currently facing. Confidence among small retailers remains low, with pressure from employment costs, high rents and competition from large, exclusively online brands.”

“It is vital that in the upcoming Budget, the Chancellor prioritises business rates to help lessen the pressure on struggling small firms.”

“While the retail rates discounts this year have been welcomed, these will soon come to an end – leaving us with a system that remains regressive and is not linked to a business’ ability to pay.”

“Given the pressure on small businesses, improving the relief by increasing the 33% discount to 50% or more, making it permanent – and indeed extending it to include small firms across the economy, would help revitalise and reform town centres.”

“The ball is firmly in the Government’s court when it comes to coming up with ways to improve the current business rates system and prove they are on the side of small businesses.”