Retailers are continuing efforts to mitigate cost pressures on consumers, according to the British Retail Consortium (BRC). The latest BRC-NIQ Shop Price Index revealed that shop price inflation increased to -0.4% year on year in March, compared to a decline of -0.7% in February, which is above the 3-month average of -0.6%.
Non-food inflation rose to -1.9% year on year in March from a decline of -2.1% in February, aligning with the 3-month average of -1.9%. Food inflation increased to 2.4% in March, up from 2.1% in February, exceeding the 3-month average of 2.0%.
BRC Chief Executive Helen Dickinson stated that although prices fell across most non-food categories, which maintained year-on-year shop price deflation, the reduction rate was slower than in February. She noted that 'clothing and footwear was in double-digit deflation as a result of weak consumer demand'. In contrast, food prices saw a rise, particularly in ambient foods, driven by factors such as increased duties and high global sugar prices.
With upcoming costs related to the Budget and new packaging taxes, retailers are expected to face an additional £7bn in expenses. Dickinson emphasised the importance of avoiding further cost inflation through the Employment Rights Bill and business rates reform.
Mike Watkins, Head of Retailer and Business Insight at NielsenIQ, highlighted that high street competition is intensifying as retailers attempt to attract cautious consumers through seasonal promotions. He suggested that more targeted price reductions might be needed to sustain footfall in the lead-up to Easter.
Retailers remain focused on balancing cost increases with consumer affordability amid ongoing economic pressures.
Source: www.bigfurnituregroup.com