30 October 2018

  |  CBI Press Team

Press release

Retail sales cool as summer boost fades

Retail sales growth slowed noticeably in the year to October, following four consecutive months of firm sales growth during the summer, according to the latest monthly CBI Distributive Trades Survey.  

Retail sales cool as summer boost fades

The survey of 104 firms, of which 45 were retailers, also showed that sales volumes were significantly below average for the time of year in October. Orders placed with suppliers fell, but are expected to rebound next month. Similarly, retailers expect sales growth to recover somewhat in November.  

Within the retail sector, growth in sales volumes was reported only in the non-store (i.e. internet and mail order) and footwear & leather sub-sectors. Sales either stayed flat or fell elsewhere, with notable declines seen in the furniture & carpets, hardware & DIY, and other normal goods sub-sectors.  

However, the picture on internet retail sales was more upbeat, with year-on-year growth in October speeding up to its quickest pace since January 2017. Internet sales are expected to expand at an even faster pace next month. 

Wholesalers reported a slowing in sales volume growth in the year to October, and they expect a further easing next month. Motor trades saw a strong pick-up in sales growth in the year to October, but they expect a slower rise in November.

Momentum in the retail sector is likely to remain relatively subdued going forward, as firms continue to grapple with weak household income growth and structural changes posed by digital disruption. For more detail on our broader view of the economic outlook, see our June economic forecast.

Alpesh Paleja, CBI Principal Economist, said:

“Retail sales have begun to cool, as the boost from the summer heatwave and World Cup celebrations fades away.

“It’s clear the challenges facing the retail sector are significant. The double whammy of the sluggish recovery in household incomes and digital disruption is making trading conditions tough, and prompting a deeper structural shift in business models. 

“The Autumn Budget was a perfect opportunity to address these challenges, through further action on business rates –which have become an additional burden for the High Street. While smaller businesses will be relieved at the Chancellor’s announcements, larger retailers will continue to suffer until there is a full, in-depth review of the business rates regime.” 

Key findings: 


  • 26% of respondents reported that sales volumes were up on a year ago, while 21% said they were down, giving a rounded balance of +5%. 
  • Retailers expect sales growth to pick-up next month (+17%), with 32% expecting them to rise and 15% to fall. 
  • Sales volumes for the time of year were below average (-22%), their weakest since March 2018. Sales are expected to remain below seasonal norms in November, though to a lesser extent (-9%).   
  • The volume of orders placed upon suppliers fell in the year to October, with 10% of survey respondents reporting a rise and 20% reporting a fall, giving a balance of -10%. Retailers anticipate that orders growth will rebound next month (+23%). 
  • Year-on-year growth in internet sales volumes in October (+56% from +46% in September) was above its long-run average, with a pick-up in growth expected next month (+62%). 
  • Growth in sales volumes was seen in the non-store (i.e. internet and mail order) (+54%), and footwear & leather sales (+11%) sub-sectors. 
  • However, falling sales volumes were reported in the furniture & carpets (-75%), other normal goods (-31%), and hardware & DIY (-30%) sub-sectors.


  • 40% of wholesalers reported sales volumes to be up in the year to October and 18% said they were down, giving a balance of +22%.   

Motor trades 

  • 55% of motor traders reported sales volumes to be up on last year and 15% said they were down, giving a balance of +40%.