Press release

25 Mar 2021 London, GB

March CBI survey indicates ongoing limited consumer spending but brighter prospects for April – EY ITEM Club comments

The weak March CBI distributive trades survey reflects the closure of non-essential stores limiting retail sales. The sales balance remained at -45% after rising to this level in February from an eight-month low of -50% in January

Press contact
Vienn McMasters

Senior Executive, Communications, Ernst & Young LLP

Media relations specialist across a range of sectors. Passionate about story telling.

  • The weak March CBI distributive trades survey reflects the closure of non-essential stores limiting retail sales. The sales balance remained at -45% after rising to this level in February from an eight-month low of -50% in January
  • But retailers are much more upbeat about sales prospects in April, with a balance of +17% expecting sales volumes to be up year-on-year. Expectations have been lifted by the anticipated reopening of non-essential stores from 12 April, although it also reflects the weak sales performance in April 2020 when the first lockdown was in place
  • Consumers look well-placed to play a key role in UK recovery from the second quarter onwards as restrictions on activity are eased. Consumer confidence picked up significantly in March to a one-year high, according to GfK
  • Consumer activity should benefit from high savings ratios, especially as it now looks likely that unemployment will rise much less than previously expected, helped by the extension of the furlough scheme to September.

Howard Archer, chief economic advisor to the EY ITEM Club, said:

“The March CBI distributive trades survey points to the ongoing closure of non-essential stores continuing to limit retail sales over the first part of the month.

“The CBI’s sales balance remained at -45% in March after rising to this level in February from -50% in January – the lowest level since last May. The balance had fallen to January's low from -3% in December as non-essential stores were shut anew after a brief re-opening.

“A balance of 37% of retailers considered sales volumes in March to be below average for the time of year, similar to the 38% balance in February.

“The CBI indicated that sales volumes fell significantly in March in categories such as clothing, footwear, furniture & carpets and for department stores. There was also a notable decrease year-on-year in grocery store sales, although that was influenced by particularly high sales a year earlier when consumers were stocking up ahead of the first lockdown.

“Online sales growth slowed in March from a record rate in February, with the CBI reporting that the online sales balance dipped to +60% from +75%.

“With non-essential stores allowed to re-open from 12 April, retailers were more upbeat about sales prospects in April, with a balance of +17% expecting retail sales volumes to increase year-on-year. But this also reflects the fact that sales were low in April 2020 due to the first lockdown. The positive April expectations balance of +17% compares with a balance of -62% who had expected sales to be higher in March.”