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Retail sales fall 0.7% in October as Budget uncertainty gripped nation

ended 22. November 2024

As uncertainty ahead of the Budget gripped the nation, retail sales volumes are estimated to have fallen by 0.7% in October 2024, following a rise of 0.1% in September 2024 (revised down from 0.3%), according to official data published this morning. The strongest subsector fall was within clothing stores, which fell by 3.1% over the month to October 2024. Non-food stores sales volumes – the total of department, clothing, household and other non-food stores – fell by 1.4% in October 2024, following a rise of 2.3% in September. Retailers across a range of industries suggested that low consumer confidence and uncertainty around the Budget announcement affected sales. More broadly, sales volumes rose by 0.8% in the three months to October 2024, when compared with the three months to July 2024.

4 responses from the Newspage community

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Nicholas Found
Senior Consultant at Retail Economics
Rising anxiety ahead of the Budget, combined with higher energy bills and mild weather, dampened consumer confidence and delayed spending on seasonal items. The later timing of the half-term break also shifted some activity into November, which could bolster sales as retailers prepare for the Black Friday surge. However, the Budget is adding to retailers’ challenges, introducing significant cost burdens with upcoming higher employer contributions and wage uplifts. These pressures are likely to squeeze already thin margins, further constrain investment, and limit retailers' ability to absorb costs — a risk that could pressure shop prices next year and lead to job losses. Although households were spared immediate tax hikes in the Budget, caution reigns in the critical golden quarter for retail as households continue to adjust to higher prices and real wage growth at a meagre 2%. Consumers are focusing spending on carefully timed promotions and essentials, while deferring big purchases.
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Riz Malik
Independent Financial Adviser at R3 Wealth
Keir Starmer should focus on domestic issues as the country’s economy is on its knees and this is before we start to see the outcome of the disastrous Budget. Retailers are looking for Black Friday to be their saviour as it is clear they are not going to get any help from the current administration.
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John Choong
Head of Equities and Markets at Interpretiv
The latest retail sales figures are a sobering picture for retailers, as October sales fell well short of market expectations just as we enter the crucial golden quarter. This setback is particularly frustrating given the summer's momentum, which had nearly closed the gap with 2022 volumes after three consecutive months of volume growth. However, it's not necessarily all doom and gloom for the rest of the winter. The post-Budget consumer confidence figures saw an unexpected bounce, which may suggest October's weakness might be more of a temporary blip than a trend. More encouragingly, consumers' appetite for major purchases has surged to the second-highest point this year. Although it remains to be seen whether this optimism is down to Black Friday anticipation, both personal finance and broader economic outlook metrics did trend up in the latest consumer confidence survey as well. Hence, retailers might find something to celebrate on this otherwise gloomy morning.
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Jenny Blyth
Small business owner at Storm in a Teacup Gifts
Unfortunately for the majority of small businesses, Brexit has reared its ugly head in the form of GPSR. As we hurtle toward our busiest season we are now facing the inability to send items to Northern Ireland or anywhere within the EU if we are unable to follow the regulations. Given that the majority of us are so small it’s just not possible and so we now face a real dent in our sales.