This bulletin presents estimates of the amount spent and quantity bought in the retail sector for the period 31 March 2013 to 27 April 2013. The estimates are based on a monthly survey of 5,000 retailers, including all large retailers employing 100 people or more. The timeliness of these retail sales estimates, which are published just two weeks after the end of each month, makes them an important early economic indicator. The sector as a whole is used as an indicator of how the wider economy is performing and the strength of consumer spending.
|Most recent month on a year earlier||Most recent 3 months on a year earlier||Most recent month on previous month||Most recent 3 months on previous 3 months|
|Amount spent (Value)||1.3||1.2||-1.3||1.0|
|Quantity bought (Volume)||0.5||0.7||-1.3||0.7|
|Value excluding automotive fuel||1.4||2.0||-1.2||1.0|
|Volume excluding automotive fuel||0.2||1.2||-1.4||0.7|
In April 2013, the quantity of goods bought in the retail sector (volume) increased by 0.5% compared with April 2012. The amount spent (value) increased by 1.3% over the same period. Since April 2012, non-seasonally adjusted data show that the prices of goods sold in the retail sector (as measured by the implied price deflator) increased by 0.6%. More information on how the implied price deflator is measured can be found in the background notes.
To enable a comparison of change, figure 1 shows the quantity of goods bought in the retail sector (all retailing sales volumes) as indices referenced to 2009. Between 2003 and early 2008, the quantity bought grew steadily. Since the beginning of 2008, growth has slowed and become more volatile compared with early years.
The retail industry is divided into four retail sectors; predominantly food stores, predominantly non-food stores, non-store retailing and stores selling automotive fuel. In April 2013, for every pound spent in the retail sector 41 pence was spent in food stores, 42 pence in non-food stores, 5 pence in non-store retailing and 12 pence was spent on fuel. Using these as weights along with the year-on-year growth rates we can calculate how each sector contributed to the total year-on-year growth in the quantity bought.
Figures 2 and 3 show the contribution that each sector had to the quantity bought (volume) and amount spent (value) in retail between April 2012 to April 2013. It is clear that food stores provided the only source of downwards pressure to the year-on-year growth in the quantity bought and the amount spent.
In April 2013, the quantity bought in the food sector decreased by 3.8% compared with April 2012. Looking at the monthly picture, April 2013 compared with March 2013, the quantity bought decreased by 4.1%. This fall of 4.1% is the largest fall since May 2011 where a fall of 4.3% in the quantity bought was influenced by the royal wedding in April 2011.
The contraction within the food sector both on the year and on the month leads to the level of goods bought in this sector falling to its lowest point since December 2003 as shown in figure 4.
One possible reason for this contraction was a rise in prices, as indicated in figure 4 by store price inflation. Consumer prices data show that food prices have steadily been increasing and that there is a wide variety of food types contributing to the rise (including staple goods). April’s CPI release states that “the only notable upward contribution came from price movements for food & non-alcoholic beverages”. This rise in prices will have squeezed consumers’ disposable income, possibly resulting in them buying less or substituting cheaper goods for their normal purchases.
Looking at the variation between stores of different sizes, the amount spent (non-seasonally adjusted) shows that within the food sector, sales within large stores (or supermarkets) fell by 1.2% in April 2013 compared with April 2012. Over the same period, sales within small stores also fell by 5.1%, however, it is the large stores that dominate this sector with a contribution of 86%.
Assuming the Monthly Commodity Index (MCI) is a suitable proxy for sales within the large supermarkets, the data show that sales of food, drink and tobacco have fallen by 1.4%. This is the largest year-on-year fall since March 2000. Other MCI data show there were increases in the amount spent within clothing & footwear and other non-food, however, there was a decrease in the amount spent in household goods. Feedback from retailers suggested that the cold weather continued to impact on sales. In particular, the weather hindered sales within their spring and summer ranges, including barbecue items and garden furniture.
In the April 2013 four week reporting period, the amount spent in the retail sector was £26.0 billion (non-seasonally adjusted). This compares with £32.9 billion in the March 2013 five week reporting period and £25.9 billion in the April 2012 four week reporting period.
This equates to an average weekly spend of £6.5 billion in April 2013, £6.6 billion in March 2013 and £6.5 billion in April 2012.
Average weekly spending online (internet sales values non-seasonally adjusted) in April 2013 was £571.7 million. This was an increase of 13.2% compared with April 2012.
The amount spent online accounted for 10.0% of all retail spending excluding automotive fuel.
As expected, more was spent online in the non-store retailing sector than any other sector. Spending online now accounts for 66.6% of total spending in this sector. In the food sector 3.4% of spending was online. This sector has the lowest proportion of online spending in relation to all spending.
Internet sales estimate how much was spent online through retailers across all store types in Great Britain. Figures are non-seasonally adjusted and the reference year is 2010=100. Table 2 shows the year-on-year growth rates for total internet sales, by sector and the contribution that each sector makes to total internet sales.
|Category||Weight (%)||Year on year growth %||Contribution to year on year growth % points|
|Textile, clothing and footwear stores||11.7||17.4||2.0|
|Household goods stores||8.2||-15.8||-1.3|
|* - components may not sum to totals due to rounding methods used|
Predominantly food stores in April 2013 saw a decrease in the amount spent (0.2%) compared with April 2012. The quantity bought decreased by 3.8% over the same period. The prices of goods sold within this sector increased by 3.4%.
In April 2013, average weekly sales in this sector were £2.7 billion, which was more than any other sector. Also in this sector 3.4% of sales, £92.7 million, were made via the Internet.
Predominantly non-food stores in April 2013 saw an increase in the quantity of goods bought (2.1%) and in the amount spent (1.5%) when compared with April 2012. The prices of goods sold decreased by 0.6% in the year to April 2013.
In April 2013, average weekly sales were £2.6 billion. In this sector 7.9% of sales were made via the Internet, resulting in £205.7 million of online spending.
Non-specialised stores, or department stores, provided an upwards contribution to the quantity bought in all retailing with an increase of 2.5% in April 2013 compared with April 2012. The amount spent also increased by 1.1% in April 2013 compared with April 2012. The prices of goods sold in this sector decreased, falling by 1.5% in the year to April 2013.
In April 2013, average weekly sales were £0.5 billion. In this sector 8.5% of sales, £41.4 million, were made via the Internet.
The textile, clothing and footwear stores sector also provided an upwards contribution to the quantity bought in all retailing with an increase of 1.2% in April 2013 compared with April 2012. The amount spent increased year-on-year by 1.3% and the prices of goods remained flat.
In April 2013, average weekly sales were £0.7 billion. In this sector 10.2% of sales, £75.5 million, were made via the Internet.
Household goods stores in April 2013 saw a decrease in the quantity bought (3.8%) and the amount spent (4.2%) compared with April 2012. The prices of goods sold decreased by 0.2% in the year to April 2013.
In April 2013 average weekly sales were £0.6 billion. In this sector 5.4% of sales, £29.9 million, were made via the Internet.
Other stores in April 2013 saw an increase in the quantity bought (6.7%) and an increase in the amount spent (6.1%) compared with April 2012. The prices of goods sold in this sector continued to decrease, falling 0.8% in the year to April 2013.
In April 2013 average weekly sales were £0.8 billion. In this sector 7.2% of sales, £58.9 million, were made via the Internet.
The non-store retailing sector in April 2013 saw a rise in the quantity bought (14.0%) and in the amount spent (12.4%) compared with April 2012. The prices of goods sold fell by 1.3% in the year to April 2013.
In April 2013 average weekly sales were £0.4 billion. In this sector 66.6% of sales, £273.3 million, were made via the Internet.
The non-store retailing sector comprises of stalls and markets, mail order and those retailers that mainly sell online.
Predominantly automotive fuel stores saw a year-on-year increase in both the quantity bought (3.1%) and the amount spent (0.1%). The prices of goods sold in this sector decreased by 2.9% in the year to April 2013.
In April 2013 average weekly sales were £0.8 billion.
Table 3 illustrates the mix of experiences among different sized retailers. It shows the distribution of reported change in sales values of businesses in the RSI sample, ranked by size of business (based on number of employees). This table shows, for example, that the largest retailers, with 100 or more employees, reported an average decrease in sales values of 0.2% between April 2012 and April 2013. In contrast smaller retailers employing 10 to 39 employees reported an average increase in sales of 13.9%.
|Number of employees||Weights (%)||Growth since April 2012 (%)|
The reference table, Business Analysis (30.5 Kb Excel sheet) , shows the extent to which individual businesses reported actual changes in their sales between April 2012 and April 2013. The table contains information only from businesses that reported in April 2012 and April 2013. Cells with values less than 10 are suppressed for some classification categories; this is denoted by n.a. Note that ‘large’ businesses are defined as those with 100+ employees and 10–99 employees with annual turnover of more than £60 million, while ‘small and medium’ is defined as 0–99 employees.
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Understanding the data
1. Quick Guide to the Retail Sales Index (116.9 Kb Pdf)
2. Interpreting the data
The Retail Sales Index (RSI) is derived from a monthly survey of 5,000 businesses in Great Britain. The sample represents the whole retail sector and includes the 900 largest retailers and a representative panel of smaller businesses. Collectively all of these businesses cover approximately 90 per cent of the retail sector in terms of turnover.
The RSI covers sales only from businesses registered as retailers according to the Standard Industrial Classification (SIC), an internationally agreed convention for classifying industries. The retail sector is division 47 of the SIC 2007 and retailing is defined as the sale of goods to the general public for household consumption. Consequently, the RSI includes all Internet businesses whose primary function is retailing and also covers Internet sales by other British retailers, such as online sales by supermarkets, department stores and catalogue companies. The RSI does not cover household spending on services bought from the retail sector as it is designed to only cover goods. Respondents are asked to separate out the non-goods elements of their sales, for example income from cafeterias. Consequently, online sales of services by retailers, such as car insurance, would also be excluded.
The monthly survey collects two figures from each sampled business: the total turnover for retail sales for the standard trading period, and a separate figure for sales made over the Internet. The total turnover will include Internet sales. The separation of the Internet sales figure allows an estimate relating to Internet sales to be calculated separately.
3. Definitions and explanations
The value or current price series records the growth since the base period (currently 2009) of the value of sales ‘through the till’ before any adjustment for the effects of price changes.
The volume or constant price series are constructed by removing the effect of price changes from the value series. The Consumer Prices Index (CPI) is the main source of the information required on price changes. In brief, a deflator for each type of store (5-digit SIC) is derived by weighting together the CPIs for the appropriate commodities, the weights being based on the pattern of sales in the base year. These deflators are then applied to the value data to produce volume series.
The implied deflator or the estimated price of goods is derived by dividing the non-seasonally adjusted value and volume data to leave a price relative. In general, this implied price deflator should be quite close to the retail component of the CPI. More information on the implied price deflator can be found in the Quick Guide to Retail Sales (116.9 Kb Pdf) .
4. Use of the data
The value and volume measures of retail sales estimates are widely used in private and public sector organisations. For example, private sector institutions such as investment banks, the retail sector itself and retail groups use the data to inform decisions on the current economic performance of the retail sector, these organisations are most interested in a long term view of the retail sector that can be obtained from year-on-year growth rates. Public sector institutions use the data to assist in informed decision and policy making and tend to be most interested in a snapshot view of the retail sector, which is taken from the month-on-month growth rates.
Information on retail sales methodology is available in Retail Sales Methodology and Articles
1. Composition of the data
Estimates in this statistical bulletin are based on financial data collected through the monthly Retail Sales Inquiry. The response rates for the current month reflect the response rates at the time of publication. Late returns for the previous month’s data are included in the results each month. Response rates for historical periods are updated to reflect the current level of response at the time of this publication.
|Overall response rates (%)|
2. Seasonal adjustment
Seasonally adjusted estimates are derived by estimating and removing calendar effects (for example Easter moving between March and April) and seasonal effects (for example increased spending in December as a result of Christmas) from the non-seasonally adjusted (NSA) estimates. Seasonal adjustment is performed each month, and reviewed each year, using the standard, widely used software, X-12-ARIMA. Before adjusting for seasonality, prior adjustments are made for calendar effects (where statistically significant), such as returns that do not comply with the standard trading period (see section Methods, Calendar effects), bank holidays, Easter and the day of the week on which Christmas occurs.
The data collected from the retail sales survey is the amount of money taken through the tills of retailers; these are non-seasonally adjusted data. These data consist of three components:
trend which describes long-term or underlying movements within the data
seasonal which describes regular variation around the trend, that is peaks and troughs within the time series, the most obvious in this case being the peak in December and the fall in January
irregular or ‘noise’, for example deeper falls within the non-seasonally adjusted series due to harsh weather impacting on retail sales
To ease interpretation of the underlying movements in the data, the seasonal adjustment process estimates and removes the seasonal component to leave a seasonally adjusted time series consisting of the trend and irregular components.
In the non-seasonally adjusted retail sales index we see large rises in December each year and a fall in the following January, but these are not evident in the seasonally adjusted index. This peak in December is larger than the subsequent fall but the trend and irregular components in both months are likely to be similar, meaning that the movements in the unadjusted series are almost completely as a result of the seasonal pattern.
3. Calendar effects
The calculation of the RSI has an adjustment to compensate for calendar effects that arise from the differences in the reporting periods. The reporting period for April 2013 was 31 March 2013 to 27 April 2013, compared with 1 April 2012 to 28 April 2012 the previous year. Table 5 shows the differences between the calendar and seasonally adjusted estimates.
|Year on year percentage change|
1. Basic quality information
The standard reporting periods can change over time due to the movement of the calendar. Every five or six years the standard reporting periods are brought back into line by adding an extra week. For example, January is typically a four-week standard period but January 1986, 1991, 1996, 2002 and 2008 were all five-week standard periods. The non-seasonally adjusted estimates will still contain calendar effects. If the non-seasonally adjusted estimates are used for analysis this can lead to a distortion depending on the timing of the standard reporting period in relation to the calendar, previous reporting periods and how trading activity changes over time.
The non-seasonally adjusted series contain elements relating to the impact of the standard reporting period, moving seasonality and trading day activity. When making comparisons it is recommended that users focus on the seasonally adjusted estimates as these have the systematic calendar related component removed. Due to the volatility of the monthly data, it is recommended that growth rates are calculated using an average of the latest three months of the seasonally adjusted estimates.
When interpreting the data, consideration should be given to the relative weighted contributions of the sectors within the all retailing series. Based on SIC 2007 data, total retail sales consists of: predominantly food stores 41.3%, predominantly non-food stores 41.6%, non-store retailing 5.3% and automotive fuel 11.8%.
2. Standard errors
The standard error of an index movement is a measure of the spread of possible estimates of that movement likely to be obtained when taking a range of different samples of retail companies of the same size. This provides a means of assessing the accuracy of the estimate: the lower the standard error, the more confident one can be that the estimate is close to the true value for the retail population. An approximate 95% confidence interval for the index movement is roughly twice the standard error. The paper ‘Measuring the accuracy of the Retail Sales Index’ (1.04 Mb Pdf) , written by Winton, J and Ralph, J (2011) reports on the calculation of standard errors for month-on-month and year-on-year growth rates in the RSI as well as providing an overview of standard errors and how they can be interpreted.
The standard error for year-on-year growth in all retail sales volumes is 0.7%. This means that the year-on-year growth rate for all retail sales volumes falls within the range 0.3 ± 1.4% with a probability of 95%.
The standard error for month-on-month growth in all retail sales volumes is 0.4%. This means that the month-on-month growth rate for all retail sales volumes falls within the confidence interval -0.1 ± 0.8 with a probability of 95%.
3. Summary quality report
A Summary Quality Report (114 Kb Pdf) for the RSI
This report describes, in detail the intended uses of the statistics presented in this publication, their general quality and the methods used to produce them.
4. Revision triangles
Revisions to data provide one indication of the reliability of key indicators. The table below shows summary information on the size and direction of the revisions which have been made to the volume data covering a five-year period. Note that changes in definition and classification mean that the revision analysis is not conceptually the same over time. A statistical test has been applied which has shown that the average revision in month-to-month statistics are not statistically different from zero.
A spreadsheet giving these estimates and the calculations behind the averages in the table is available on the ONS website.
|Volume seasonally adjusted|
|Revisions between first publication and estimates twelve months later (percentage points)|
|Growth in latest period (per cent)||Average over the last five years (mean revision)||Average over the last five years without regard to sign (average absolute revision)|
|Latest three months compared with previous three months||0.7||-0.26||0.37|
|Latest month compared with previous month||-1.3||-0.13||0.44|
Methodological changes were introduced in the April 2009 and January 2010 releases. For more detail see:
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The complete run of data in the tables of this statistical bulletin is available to view and download in electronic format using the ONS Time Series Data service. Users can download the complete bulletin in a choice of zipped formats, or view and download their own sections of individual series. The Time Series Data are available.
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Next publication: Thursday 20 June 2013
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