Statistical bulletin: Retail Sales, July 2011

Retail Sales - July 2011

• Headline: Value of retail sales in July 2011 showed an increase of 4.3 per cent compared with July 2010.
• Headline: Sales volumes in July 2011 was unchanged compared with July 2010.
• Between July 2010 and July 2011 predominantly food stores volumes decreased 1.6 per cent; following last months record fall.
• An estimated £26.0 billion was spent on retail goods during July 2011, up from £24.9 billion in July 2010.

July 2011

Contains a first estimate of retail sales in value and volume terms, seasonally and non-seasonally adjusted.

Key figures

Supplementary Analysis

Supplementary Analysis

Year on year, July 2010 compared to July 2011 the seasonally adjusted value of all retail sales, increased by 4.3 per cent; up 0.3 percentage points from the June 2011 year on year comparison.  Between the same periods the implied deflator increased by 4.4 per cent, the highest year on year rise since July 2008.  Excluding predominantly automotive fuel, the retail sales implied deflator increased by 3.1 per cent the highest year on year increase since October 1995.

July 2010 compared to July 2011 saw 0.0 per cent, year on year seasonally adjusted growth in  volume of all retail sales.  Downwards volume pressures in July 2011 compared to July 2010 came from predominantly food stores, textile clothing and footwear stores, household goods stores and other stores.  Upwards volume pressures came from non-specialised stores, non-store retailing and fuel.

The food sector

Between July 2010 and July 2011, predominantly food stores:

• sales values increased by 4.0 per cent; compared to an increase of 1.3 per cent between June 2010 and June 2011

• sales volumes decreased by 1.6 per cent; compared to a decrease of 4.1 per cent between June 2010 and June 2011 (the largest decrease since the series began)

Looking in more detail at the non-seasonally adjusted, year on year, predominantly food stores sales volumes:

• large businesses decreased by 2.1 per cent; compared to a decrease of 4.2 per cent between June 2010 and June 2011

• small businesses increased by 1.1 per cent; compared to a decrease of 4.0 per cent between June 2010 and June 2011

In both June and July 2011, stores predominantly selling alcoholic drinks, other beverages and tobacco, saw the first year on year growth in volume since November 2008.

Household goods stores

Between July 2010 and July 2011, household goods stores saw decreases in both their sales values and volumes:

• sales values decreased by 3.4 per cent; compared to a decrease of 3.8 per cent between June 2010 and June 2011

• sales volumes decreased by 4.1 per cent; no change compared to between June 2010 and June 2011

Looking in more detail at the non-seasonally adjusted, year on year, household goods stores sales volumes:

• large businesses decreased by 1.9 per cent; compared to a decrease of 3.0 per cent between June 2010 and June 2011

• small businesses decreased by 8.2 per cent; compared to a decrease of 6.3 per cent between June 2010 and June 2011

Retail Sales in detail

The Retail Sales Index (RSI) measures spending (value) and volume of retail sales in Great Britain. Figures are adjusted for seasonal variations unless otherwise stated and the reference year for both value and volume statistics is 2006 = 100. For an explanation of the terms used in this bulletin, please see the background notes section. Care should be taken when using the month on month growth rates due to their volatility, an assessment of the quality of the retail statistics is available in the background notes.

Year on year growth rates and contribution to all retail by sector

Sector Analysis

Predominantly food stores volume sales decreased by 1.6 per cent in July 2011 compared to July 2010. Sales values increased by 4.0 per cent over the same period. The prices of goods sold within this sector are estimated to have increased by 5.7 per cent since July 2010. The estimated total value of sales within this sector is approximately £10.7 billion (non-seasonally adjusted) more than any other retail sales sector.

Large stores experienced sales volumes falls of 2.1 per cent (non-seasonally adjusted) while small stores experienced sales increases of 1.1 per cent (non-seasonally adjusted). Non-specialised food stores or supermarkets sales volumes decreased by 1.5 per cent (non-seasonally adjusted) with large businesses decreasing by 2.1 per cent (non-seasonally adjusted) and small stores in this sector increasing by 4.3 per cent (non-seasonally adjusted). Specialist food stores decreased by 5.6 per cent (non-seasonally adjusted), stores selling alcohol and tobacco increased by 4.2 per cent (non-seasonally adjusted).

Predominantly non-food stores volume sales decreased by 1.1 per cent in July 2011 compared to July 2010. This comprised approximately -0.9 percentage points from household goods stores,    -0.6 percentage points from other stores, -0.3 percentage points from textile, clothing and footwear stores and 0.7 percentage points from non-specialised stores.

Sales values increased by 0.2 per cent over the same period. This comprised approximately 0.7 percentage points from textile, clothing and footwear stores, 0.6 percentage points from non-specialised stores, -0.4 percentage points from other stores and -0.7 percentage points from household goods stores.

The prices of goods sold in this sector are estimated to have increased by 1.4 per cent. The estimated total value of sales within this sector is approximately £10.8 billion (non-seasonally adjusted).

Non-specialised stores volume sales increased by 4.0 per cent between July 2011 and July 2010, sales values increased by 3.6 per cent. The prices of goods sold within this sector are estimated to have decreased by 0.4 per cent. The estimated total value of sales within this sector is approximately £1.9 billion (non-seasonally adjusted).

Textile, clothing and footwear stores volume sales decreased by 1.0 per cent between July 2011 and July 2010, sales values increased by 2.7 per cent. The prices of goods sold within this sector are estimated to have increased by 3.5 per cent. The estimated total value of sales within this sector is approximately £3.2 billion (non-seasonally adjusted).

Household goods stores volume sales decreased by 4.1 per cent in July 2011 compared with July 2010 and saw sales values decrease by 3.4 per cent over the same period. The prices of goods sold within these stores are estimated to have increased by 1.2 per cent. The estimated total value of sales is approximately £2.3 billion (non-seasonally adjusted).

Other stores volume sales decreased by 2.0 per cent on the year and sales values decreased by 1.5 per cent over the same period. The prices of goods sold in this sector are estimated to have increased by 0.6 per cent over the same period and the estimated value of sales in this sector is approximately £3.4 billion (non-seasonally adjusted).

Non-store retailing volume sales increased by 16.9 per cent in July 2011 compared with July 2010.The value of retail sales in this sector increased by 16.1 per cent over the same period. The prices of goods sold through non-store retailing are estimated to have decreased by 0.8 per cent. The estimated total value of sales is approximately £1.3 billion (non-seasonally adjusted).

Predominantly automotive fuel volume sales increased by 2.6 per cent in July 2011 compared to July 2010. The value of retail sales in this sector increased by 17.7 per cent over the same period. The prices of goods sold by this sector are estimated to have increased by 14.5 per cent. The estimated total value of sales is approximately £3.2 billion (non-seasonally adjusted).

Internet sales

Based on ONS experimental Internet sales series, the non-seasonally adjusted average weekly value of Internet retail sales in July 2011 was £523.4 million which was approximately 9.1 per cent of total retail sales (excluding automotive fuel), compared with July 2010 which was £395.8 million which was approximately 7.1 per cent of total retail sales (excluding automotive fuel).

Pounds thousand data is available to download under "data with this release". 

Distribution analysis

The table below illustrates the mix of experiences among different sized retailers. It shows the distribution of the reported growth of businesses in the RSI sample, ranked by size of business (based on number of employment). For example, this shows that the largest retailers, with 100 or more employment, reported an average increase in sales of 5.8 per cent between July 2010 and July 2011.

Analysis of individual returns from businesses

The table below illustrates the extent to which individual businesses experienced actual changes in their sales between July 2010 and July 2011. The table contains information only from businesses which reported in both periods. Cells with values less than 10 are suppressed for some classification categories, this is denoted by n.a.. Note that large is defined as 100+ employment and 10-99 employment with annual turnover of more than £60m, while small and medium is defined as 0-99 employment.

Summary Statistics

Summary of statistics for value and volume (seasonally adjusted) are available to download under "data with this release".

Background notes

1. What’s new?

   New ONS website

   The launch of the new ONS website on 28 August 2011 will bring changes to the design and format of statistical bulletins. The bulletin main body will be in html and pdf format but detailed data tables will be available as Excel spreadsheets only. The new website will improve the way users can access our statistics but many existing bookmarks and links will no longer work and users will need to update them.

2. Code of Practice for Official Statistics

   National Statistics are produced to high professional standards set out in the Code of Practice for Official Statistics. They undergo regular quality assurance reviews to ensure that they meet customer needs. They are produced free from any political interference. © Crown copyright 2011. Further information can be found on the ONS website.

3. Understanding the data

   Quick Guide to the Retail Sales Index (116.9 Kb Pdf)

   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 all large retailers and a representative panel of smaller businesses. Collectively all of these businesses cover approximately 95 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, e.g. income from cafeterias. Consequently on-line 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.

   Definitions and explanations

   • The value or current price series records the growth since the base period (currently 2006) 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 Price 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 CPI’s 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 estimated prices of retail sales (sometimes called the implied price deflator) is derived by comparing the value and volume data non-seasonally adjusted. In general, this implied price deflator should be quite close to the retail component of the CPI.

   Experimental statistics are those which are in the testing phase and are not yet fully developed. The main reason why the Internet retail sales are designated as experimental is that the methods and data sources are still being improved. 

   Retail sales index categories and their percentage weights in 2009 are available to download under "data with this release".

   Use of the data

   The value and volume measures of retail sales estimates are widely used in private and public sector institutions, particularly by the Bank of England and Her Majesty’s Treasury, to assist in informed decision and policy making.

4. Methods

   Information on retail sales methodology is available on the ONS website

   A video explaining retail sales is available on the ONS You Tube Channel

   Composition of the data

   Estimates in the 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.

   Response rates

   			Overall response rates
   			(per cent)
   Period			Turnover		Forms
   2011	July		93.3		64.5
   	June		96.2		76.5
   	May		98.6		80.2
   	Apr		98.9		81.3

   Download table

   • XLS format
     (13.5 Kb)

   Seasonal adjustment

   Seasonally adjusted estimates are derived by estimating and removing calendar effects (e.g. Easter moving between March and April) and seasonal effects (e.g. 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 Christmas occurs.

   Calendar effects

   The calculation of the RSI has an adjustment to compensate for calendar effects which arise from the differences in the reporting periods. The reporting period for July 2011 was 3 July 2011 to 30 July 2011 compared with 4 July 2010 to 31 July 2010 the previous year. For example, the annual growth in sales volume between July 2010 and July 2011 requires 0.1 per cent adjustment to take account of the differences in reporting periods and other calendar effects.

   The following table shows the difference between the calendar and seasonally adjusted estimates.

   Calendar effects

   		Year on year percentage change
   		Value		Volume
   Calendar adjusted		4.7		0.2
   Seasonally adjusted		4.3		0.0

   Download table

   • XLS format
     (13.5 Kb)

5. Quality

   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 42.0 per cent, predominantly non-food stores 43.3 per cent, non-store retailing 4.5 per cent and automotive fuel 10.2 per cent.

   Standard errors

   A measure of the accuracy of the RSI has been produced by estimating the standard errors of index movements. For more detail see the article by Winton, J and Ralph, J (2011) ‘Measuring the accuracy of the Retail Sales Index’, Economic & Labour Market Review, February 2011, available on ONS website (2.65 Mb Pdf)

   Summary quality report

   A Quality and Methodology Information Report for the RSI can be found on the National Statistics website on ONS website (93.5 Kb Pdf)

   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.

   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 (562.5 Kb Excel sheet)

6. Relevant links

   Methodological changes were introduced in the April 2009 and January 2010 releases.

   For more detail see the ONS website for Methodological Changes June 2009 (136.2 Kb Pdf)

   An experimental measure of internet retail sales.  Changes to methods (111.5 Kb Pdf)

   For videos on retail sales please see www.youtube.com/users/onsstats

7. Publication policy

   Details of the policy governing the release of new data are available from the Media Relations Office. Also available is a list of the organisations given pre-publication access to the contents of this bulletin.

8. Accessing data

   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 can be accessed on the ONS website.  Alternatively, for low-cost tailored data call 0845 601 3034 or email info@ons.gov.uk

   ONS allows a list of agreed officials to have access to data 24 hours before publication.  This list can be found on the ONS website. 

9. Next publication:  Thursday 15 September 2011

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10. Details of the policy governing the release of new data are available by visiting www.statisticsauthority.gov.uk/assessment/code-of-practice/index.html or from the Media Relations Office email: media.relations@ons.gsi.gov.uk

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