Despite the sunshine, the BRC-KPMG Sales Monitor showed non-essentials showed no growth in May. Food sales increased by 3.6% year on year in May (2.8% May 2024) but non-food sales decreased by 1.1% in May (Year on Year). In store, non-food sales decreased by 0.9% in May (YOY), against a decline of 2.6% in May 2024 and online, a similar picture with a 1.5% decrease in May, against growth of 1.5% in May 2024. Online penetration rate (the proportion of Non-Food items bought online) remained flat at 35.9% in May, matching 35.9% in May 2024.
“Consumers put the brakes on spending, with the slowest growth in 2025 so far. This was due largely to declines in Non-food sales, as fashion and full price big-ticket items were held back by lower consumer confidence. Gaming bucked the trend, thanks to some popular new releases. Food sales remained solid as the month saw the conclusion of football tournaments and two bank holidays, prompting spending on BBQs and picnics.
“Retailers are grappling with the £5bn in extra costs from higher National Insurance contributions and wages, which kicked in during April. They also face an additional £2bn later this year from new packaging taxes and remain concerned about the consequences of the Employment Rights Bill. Ensuring the new Bill supports workers’ rights without undermining retailers’ ability to continue to provide jobs and investment in people will determine whether Government achieves economic growth across the country or not,” explained Helen Dickinson, Chief Executive of the British Retail Consortium.
Linda Ellett, UK Head of Consumer, Retail & Leisure, KPMG, added: “While the sunshine continued, the pace of retail sales growth didn’t in May. Early seasonal purchases were likely a factor, as was a dampening of some spending appetite as households reflected upon the recent combination of essential bill rises. But May still saw slight growth, driven mainly by food and drink, with non-food purchases falling overall. Travel demand for the summer months ahead looks healthy, so retailers will be hoping June sees an upturn in related spending as people begin to think about what they want to pack in their suitcase.”
Sarah Bradbury, CEO of the Institute of Grocery Distribution said: “After the sunniest spring on record and a string of bank holidays, our Shopper Confidence Index rose by five points in May, helped by the prospect of lower energy bills and renewed momentum in UK trade agreements with the US and EU. This uplift marks a welcome shift from ‘Awful April’, but beneath the surface, confidence remains fragile. Our research shows that shoppers are still navigating financial uncertainty and continue to rely on money-saving tactics like planning ahead and buying on promotion. While the mood has brightened, we’ve yet to see this translate into meaningful changes in behaviour. With the external environment still volatile, shoppers remain cautiously optimistic, but not necessarily ready to spend freely.”
