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The volume of sales on the high street in July was lower than a year earlier as shoppers reined in spending in the face of rising food and petrol prices, research finds.

The Confederation of British Industry’s Distributive Trades Survey, conducted between June 28th and July 19th, reveals that 33 per cent of retailers saw sales volumes rise on a year ago, while 38 per cent reported a fall.

The resulting balance of -5 per cent is the weakest since June 2010 (a balance of -5 per cent) and continued the weakness seen in the June survey (-2 per cent).

The decline was driven by the first fall in grocers’ sales volumes (-16 per cent) in 30 months.

Sales of footwear & leather (-84 per cent), durable household goods (-76 per cent) and hardware & DIY (-62 per cent) also fell sharply.

Retailers expect sales volumes to fall at a faster rate next month (-12 per cent).

Judith McKenna, Chair of the CBI Distributive Trades Panel says, ‘Rising prices, especially for fuel, continue to impact consumer confidence and make life tough on the high street.

‘There has been a fall in real disposable incomes since the beginning of the year with shoppers either cutting back or trading down to make their declining spending power go further. With consumer confidence fragile, UK retailers continue to face challenging times.’

The volume of orders placed by retailers upon suppliers fell (-13 per cent) at the fastest rate since May 2010 (-24 per cent), and a similar decline is expected next month.

Among wholesalers, 44 per cent report a rise in the volume of sales in July and 15 per cent a fall, giving a balance of +28 per cent. 

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