Shop prices dip as desperate retailers discount to attract customers
Shop prices dipped last month as retailers discounted to encourage consumer spending in the run up to Christmas, which was disrupted by store closures during the second coronavirus lockdown.
Prices fell 1.8 per cent in November compared to a 1.2 per cent decline in October, driven by a surge in discounting of non-food products such as fashion and DIY.
The latest research showed that non-food product prices dropped 3.7 per cent last month, following a 2.7 per cent decline the previous month.
The British Retail Consortium’s chief executive Helen Dickinson warned that retailers have lost billions of sales and that many are “now in a precarious financial position”.
She urged the government to extend the business rates holiday and moratorium on debt enforcement.
“Without such interventions,” Dickinson said, “we will see countless more store closures and job losses, deepening the crisis on our high streets”.
Meanwhile, food inflation inched to 1.3 per cent in November, up from 1.2 per cent in October, according to data from the BRC.
Food inflation was pushed up by a 2.5 per cent jump in ambient food prices, while fresh food inflation increased to 0.5 per cent.
BRC chief executive Helen Dickinson said: “As we approach Christmas, consumers will be glad to see another month of falling prices.
“This was mainly driven by non-food products, where prices have fallen at a much quicker rate than the previous month.
“Where demand was weak for some products, discounting has followed, with many retailers trying to encourage more consumer spending, particularly those selling fashion and DIY goods.
“Meanwhile, food inflation remains low, but we anticipate upward pressures on food prices once the UK-EU transition period ends.”