Stockpiling by UK retailers hits record levels amid Brexit fears and sales gloom
UK retailers fear Brexit shortages could undermine Christmas sales
Retailers are stockpiling goods as they brace themselves for Brexit uncertainty and the festive season, according to new figures from the Confederation of British Industry (CBI).
The organisation’s Distributive Trends Survey found that “stock levels in relation to expected sales” hit their highest level in October 2019 since the survey began in 1983.
The figures may suggest that retailers are concerned about Brexit shortages affecting Christmas trading, the busiest time of the retail year. The EU has agreed a Brexit extension until January 31, 2020, but as earlier reported the new delay leaves room for the UK to exit the EU before Christmas if a deal is ratified in time.
CBI figures also show that shoppers continue to be cautious in the face of Brexit uncertainty, with retail sales volumes in the year to October falling for the sixth consecutive month. The fall was at the gentlest pace in that period so far, but the CBI says the sixth-month slump is the longest period of decline since the global financial crash a decade ago.
Rain Newton-Smith, CBI chief economist, said: “The sector is struggling with ongoing digital disruption, layered on top of cost pressures from a weak pound and the cumulative burden of an outdated business rates regime.
“Retailers have also had to contend with the looming Brexit deadline, which has partly driven a record spike in stocks. The timing could not be worse: the run-up to Christmas is a crucial time of year for the retail sector and not knowing where we will be on November 1 is adding more strain to an already beleaguered sector.”