More people entertaining at home as cost of living bites

  • By Noor Nanji & Daniel Thomas
  • Business reporters, BBC News

Image supply, Getty Images

Sales of home equipment and furnishings rose sharply in March, as people ate out much less to save cash and entertained at home as a substitute, new figures recommend.

The British Retail Consortium (BRC) mentioned this helped complete retail gross sales enhance by 5.1% final month in contrast with a yr earlier.

It comes as the cost of living stays excessive, placing stress on households.

Inflation – the speed at which costs are rising – rose 10.4% within the yr to February.

According to the BRC, Mother’s Day “brightened up” gross sales in March, with people shopping for jewelry, flowers and fragrances.

But the wettest March in over 40 years held again demand for vogue gadgets, as properly as gardening and DIY merchandise.

Sales of home equipment and furnishings jumped in the course of the month, nonetheless, seeing the strongest development of any class, in accordance with the BRC and accountancy agency KPMG.

Paul Martin, UK head of retail at KPMG, mentioned people have been selecting to entertain at home to chop prices. He added that the development was prone to proceed in April as council tax, cell and utility payments rose and private tax allowances have been frozen.

“We will see consumers having to further cut back on discretionary spending,” he mentioned. “Consumers will continue to take steps to reduce spend where they can – switching where they shop, what they buy, and spending on fewer items.”

‘Cost pressures’

Meanwhile, retail analysis agency IGD mentioned that as meals costs continued to rise, grocers would search for different methods to fulfill clients.

“They are striving to deliver value with loyalty schemes, quality private label products and meal solutions that enable consumers to recreate restaurant experiences at home,” mentioned boss Susan Barrett.

Despite the challenges, the BRC mentioned client confidence was “edging up”, whereas massive occasions such as the King’s coronation in May have been prone to enhance retailers.

However, boss Helen Dickinson warned that companies proceed to face “extensive” cost pressures such as rising wholesale prices and wages.

“Unless these future costs are brought to a heel, we will likely see high inflation continue for UK consumers who already face rising household bills from this month,” she mentioned.

The Bank of England predicts inflation will fall sharply later this yr as meals and power prices come down. However, governor Andrew Bailey warned companies to not put up costs too sharply after a shock bounce within the UK inflation charge.

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