Data: Retail sales show solid growth in January despite stormy weather

Retail sales in the UK increased by 2.6% year-on-year last month, according to the latest figures from the BRC-KPMG retail sales monitor.

This growth follows a 1.2% rise in the same month last year, and was above both the three-month average growth of 1.1% and the 12-month average growth of 0.8%.

Food sales saw a more modest rise of 2.8% in January, down from 6.1% in January 2024, while non-food sales grew by 2.5%, an improvement compared to the 2.8% decline seen in January 2024.

In-store non-food sales rose by 2.6%, while online non-food sales grew by 2.2%, both of which were above their respective averages for the past three months and the past year. However, the online penetration rate for non-food items slightly decreased to 35.7%, from 35.8% in January 2024.

BRC chief executive Helen Dickinson noted that the growth was driven by consumers refreshing their homes with big discounts on home goods like furniture and bedding. Despite the impact of stormy weather during parts of the month, sales growth remained solid.

But she said: “Whether this strong performance can hold out for the coming months is yet to be seen”.

“Inflationary pressures are rising, compounded by £7bn of new costs facing retailers, including higher employer national insurance contributions, higher National Living Wage, and a new packaging levy. Many businesses will be left with little choice but to increase prices, and cut investment in jobs and stores. Government can mitigate this by ensuring its proposed business rates reforms do not result in any shop paying more in business rates.”

KMPG UK head of consumer, retail & leisure Linda Ellett added: “2025 got off to a welcome start for retailers with much needed sales growth in January.”

“But viewed over a three-month period that included Christmas and Black Friday, non-food sales have flatlined.  Overall, the golden quarter failed to shine.

“The trading environment remains tough for retailers, with consumer demand still subdued and household essential bills still high.  Business costs are also coming under pressure, with rising employment costs only increasing that in the coming months.  Boardroom focus on costs and competitiveness is sharpening.  Pricing adjustments, product launches, store closures, job losses, and increased automation and AI are all set to reshape the retail landscape in 2025.”

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