UK Retail Sales Growth has Slowed as Consumers Hold Off on Purchases, Anticipating Black Friday Discounts.

Industry sources report that a later October half-term break and ongoing budget uncertainties also contributed to reduced spending.

In October, UK retail sales growth stalled as shoppers delayed purchases, awaiting Black Friday discounts and due to a later school half-term, according to industry data. The British Retail Consortium (BRC) reported a 0.6% annual rise in total sales, down from September and less than half the three-month average growth rate.

Fashion sales were hit hardest, with mild weather limiting demand for winter clothing. Industry leaders noted that consumers were holding back on purchases in anticipation of Black Friday bargains. Additionally, the shift in England’s half-term to later October—compared to 2023—reduced holiday-related spending, which the BRC expects will show up in November’s data.

BRC CEO Helen Dickinson stated that budget uncertainty and rising energy bills had unsettled shoppers. “After a good start to autumn, October’s sales growth was disappointing,” she commented.

Food sales saw a 2.9% year-on-year increase over the three months to October, down from 7.9% growth in the same period of 2023. Non-food sales fell 0.1%, with lower spending on items like toys, baby gear, clothing, and furniture.

Separate data from Barclays also showed a spending slowdown, despite consumer confidence improving as households felt more positive about their finances and the UK’s economic outlook. Barclays, processing nearly 40% of UK card transactions, reported 0.7% growth in card spending year-on-year, below September’s 1.2% growth. Many consumers were already preparing for Black Friday, with 37% of respondents in an Opinium survey planning to shop the event, and nearly a third tracking items online for potential discounts.

Spending on essentials, including supermarket sales, dropped 2.2% year-on-year, the steepest decline since April 2020 at the height of the pandemic. September’s consumer confidence data had reflected budget anxieties, with anticipated tax hikes as part of Labour’s first budget since 2010.

Last week, the chancellor announced £40bn in tax hikes targeting businesses and wealthy individuals, aiming to restore public finances. Linda Ellett, KPMG’s UK head of consumer, retail, and leisure, noted, “With the budget providing some clarity and many households exempt from tax increases, retailers hope for a lift in consumer confidence and spending.” However, she cautioned that increased employment costs might limit retailer optimism. The Black Friday promotional period will be the first test of post-budget consumer sentiment.