Read why British retailers have to cut prices

British retailers facing problems: British Retail Consortium and KPMG reports indicate a steep yearly sales volume drop and promotional offers increase.

British retailers are hard-pressed and forced to cut their prices to drum up the company after gloomy summer weather and ever-higher interest rates combined to crush consumer spending in July.

The monthly health review of high street and online spending practices from the British Retail Consortium and the consultancy KPMG declared a steep annual decline in sales volume and a rising number of retailers offering promotional offers to woo customers unwilling to part with their money.

Also read: UK economy: interest rates soar, and business optimism falls

A separate report from Barclays found customer sensitivity to “shrinkflation” – producers slashing the size of items but charging the exact cost or more – had widened to have alcoholic drinks. Around one in five customers (22%) said they had experienced “drinkflation”, in which beers, spirits and canned cocktail drinks had less alcohol.

Both the BRC/KPMG and the Barclays monthly statements said the value of spending increased modestly in July but dropped once inflation – now 7.9% – was considered. BRC/KPMG noted the importance of sales was 1.5% higher last month than in July 2022, while Barclays said customer spending using credit and debit cards jumped by 4% from a year back.