UK discretionary retail sales fall 1.6% in April, says BDO

• April typically sees a seasonal lift in retail sales, making the decline particularly concerning for retailers according to BDO's head of retail and wholesale
• Rising fuel prices due to the Iran war drove up costs of essentials from an already high base, further straining household budgets
• The Confederation of British Industry reported the sharpest year-on-year decline in retail sales in more than 40 years amid inflation fears

UK Discretionary Retail Sales Summary

Key Findings:

British discretionary retail like-for-like sales declined 1.6% year-on-year in April, marking the weakest April performance in a decade excluding pandemic periods, according to data from BDO released May 1st.

Sector Performance:

Sales fell across multiple discretionary categories—fashion, homewares, and lifestyle—for the first time since March 2018. BDO's head of retail and wholesale, Sophie Michael, emphasized the severity of April's performance, noting the month typically experiences seasonal uplifts.

Contributing Factors:

• Weak consumer confidence and rising living costs continued pressuring household spending
• Rising fuel prices driven by the Iran war impacted household budgets, increasing costs for essential goods from already elevated levels
• The Confederation of British Industry reported British retailers experienced their sharpest year-on-year sales decline in over 40 years amid inflation fears stemming from the Iran conflict

Company Mentions:

Clothing retailer Primark confirmed that April trading conditions were challenging, though specific details were not provided in the report.

Market Implications:

The data signals ongoing pressure on UK consumer discretionary spending as households prioritize essential purchases amid elevated inflation and geopolitical uncertainty. The decade-worst performance outside pandemic periods suggests structural challenges for retailers beyond temporary disruptions. The broad-based weakness across fashion, homewares, and lifestyle categories indicates consumers are pulling back on non-essential purchases, which could negatively impact retail sector earnings and potentially signal broader economic weakness ahead.

The combination of geopolitical tensions, persistent inflation, and eroded consumer confidence presents a challenging outlook for UK discretionary retailers in the near term.