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Market Commentary

​​​Weekly Retail & Leisure News - 12​​ September, 2016

Retail​ sales growth stalls in August

Retail LFLs were down 0.9% in August according to the BRC, compared with a 1.1% increase in July. August’s sales were impacted by slow non-food and fashion sales, while food sales were boosted by warm weather and the Olympics. Sales of luxury items such as jewellery and watches were also up, strengthened by increased tourism and the weakened pound. Total sales were up by 0.6% for the quarter to the end of August. It is unlikely that August’s slowdown is a direct result of June’s EU Referendum result, but simply a continuation of the volatile monthly trading patterns witnessed over the last few years.

In other news, several retailers have announced positive results over the last week, including Joules, Halfords and Dixons Carphone. Dixons Carphone announced it has experienced no detectable impact from Brexit, as overall group revenue rose 9% YoY in the 13 weeks to July 30. Revenue was up 4% on a LFL basis across all its regions in the UK and Ireland, the Nordics and Southern Europe.

And finally, the F&B sector continues to demonstrate its resilient qualities. The number of new restaurant openings across the UK rose 5.6% in the year to June, according to AlixPartners and CGA Peach, with independent, small to medium multi-site operators particularly active. In addition, several new concept launches this week highlight the fast moving nature of the sector. IKEA is launching food workshops, as well as a DIY pop-up restaurant in Shoreditch, where customers can host a Scandi-inspired brunch, lunch or dinner party. Amazon, meanwhile, is following in the footsteps of Deliveroo, UberEats and Just Eat, and has launched a free one-hour restaurant delivery service from more than 180 restaurants in London to its Prime customers.

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