The latest Shop Price Index from the British Retail Consortium was released last night, and the top line figures show good news for the UK retail sector as strong consumer demand has seen the price of goods increase by 0.2%.
This is the second consecutive increase after the 0.1% rise noted in August and further signs of stability returning to the UK retail sector after what has been an erratic year at best.
While the inflation of non-food items eased slightly to 0.9% on a monthly basis, the unpredictability of the UK weather has seen the price we pay for our food remain inflationary at 1.9%.
But while an uplift in consumer spending is certainly a positive thing, a number of challenges still face our bricks and mortar retail sector.
Remaining competitive on price is still an area of focus despite the recent inflation in goods, not only to stand out in a competitive high street but in order to combat the growing force of online retail.
How best to deliver these goods and services is also an important focus as the online facet of high street retail also grows in preference.
However, the combination of these two challenges provides plenty of opportunity for the retail sector and if seized, can enable them to thrive even when the price of goods is at a low.
As we approach the Christmas period the high street begins to brace for the busiest time of year and this also provides a huge chance for the retail sector to prove its worth.
The question that UK retailers should be asking themselves is…
Am I ready and able to facilitate such a huge seasonal uplift in consumer demand?
It might seem obvious – do I have enough stock? do I have enough staff?
But it goes beyond this and even the smallest business can drastically increase its profitability by ensuring they have implemented a good digital strategy, with a great physical one based on customer service.
The basics are certainly a website that can handle an increase in visitors or a check out system that is easy to use and won’t break at the vital purchase point.
Additional staff on the shop floor is a must, but would it be more cost effective to mix this with an electronic enquiry facility? A contact/enquiry form or a well put together FAQs page can be a low-cost starting point, or even a managed online chat function can help shoulder some of the weight and streamline activity on the shop floor, as well as increasing conversion on your website.
Click and collect desks or self-checkouts are also an extremely useful piece of tech innovation that free up your staff on the floor to go and sell more, to more people.
Don’t forget, you can test and change on both sides – using a mystery shopper to make sure your shop floor experience is the best it can be is invaluable.
Many smaller retailers rely on Christmas to get them through January, and sometimes beyond, so at Yomdel we urge shops of all shapes and sizes to consider how they can be better – better run, better for the customer and better for the retail sector.
Our Business Growth Expert and CEO, Andy Soloman, commented on the latest findings from the BRC.
“Another consecutive increase in the BRC Shop Price Index will come as welcome news to the nation’s retailers as an unpredictable year finally starts to look up.
While our spending habits may now start to shift as the nights draw in and the temperature drops, we should see consumer confidence remain strong as thoughts turn towards Christmas.
Of course, a sustained increase in inflation could prompt the Bank of England to act but as we are unlikely to see another rate increase until mid-2019, this current positive sentiment should only strengthen and keep the economy buoyant for the short-term at least.”
