Pandemic turbocharges UK trend towards online retail

The UK has long been number one in Europe in terms of e-commerce penetration, but the Covid-19 pandemic has turbocharged the trend.

According to new data released by the Office of National Statistics (ONS), online sales reached the new record high of 33.3% of all sales in May, compared to 20% in February.

British shoppers now spend £3 out of every £10 on the internet.

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The ONS paints a relatively positive picture of a progressive increase in sales after the lockdown restrictions were eased in the UK and non-essential shops were allowed to open.

After the -18% recorded in April, when everything was still closed, sales rose by 12.3% in May and then by 13.9% in June.

While the figure for June was a -6.2% drop compared to the same month last year, the two monthly increases in May and June have brought total sales to similar levels as before the pandemic.

A further improvement is expected in July, but the ONS warns that the data masks a very mixed picture, with food sales continuing to do well and the high street still struggling.

The ONS and all economists warn that the future is very uncertain and consumer confidence is expected to remain low.

With the end of the government’s furlough scheme in October, which has supported employment throughout the crisis, a wave of redundancies is expected.

Given the level of job insecurity, over the next few months, customers may have a very cautious approach to discretionary purchases.