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Retail sales figures highlight importance of diversification for the high street

18 June 2021
Dominic Watkins, Head of Consumer at global provider of integrated legal and business services DWF, comments on the latest ONS retail sales figures for May 2021, which shows that retail sales volumes declined by 1.4% between April and May 2021 whilst in comparison with February 2020, online retail sales in May 2021 were 58.8% higher and in-store sales were 1.3% lower.

Dominic said,

"The latest ONS figures suggest the retail market is showing overall signs of recovery though we have to recognise that for part of the year much of the sector was dormant and these are the first figures including a time where hospitality was starting to reopen. While still higher, Retail sectors have all reported a fall in their proportions of online sales which is reflective of consumers' pent up desire to once again shop in-person, as lockdown restrictions ease, which is fantastic news, particularly for smaller businesses less likely to have an online business. With the green travel list having been restricted, consumers need other ways to treat themselves and these numbers suggest that consumers are again turning to retail therapy to get them through.  This is reflective of the amazing job retail has done to keep is physical and virtual doors open and offer consumers new and better ways to shop. 

"While we are starting to see a correction from the dramatic shift to online shopping, and future months are likely to bring further corrections, online retail sales are still substantially higher than pre-pandemic levels and Boris Johnson's announcement this week that stage four of lockdown easing will be delayed until 19th July 2021 due to the rapidly increasing spread of the Delta variant, will be a blow for those primarily reliant on stores or who have to meet the costs of stores that are struggling to perform profitably.  It means that it is far more difficult to achieve the passing trade, and consumers online and much more functional shopping habits adopted during lockdown make growth more challenging. It also influences consumers' confidence in visiting the high street as a result of the increase in COVID transmission. 

"Businesses want certainty and consistency in order to plan, however for the foreseeable future this will be in relatively short supply as we see further adjustments and readjustment in consumer behaviour. The retail sales figures once again highlight the importance of diversification within the sector and providing people with creative and innovative ways of shopping, whether that's through apps, virtual personal shoppers and other technologies, or addressing the whole shopping experience if retailers want to increase footfall and tempt shoppers back to physical locations."

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