Report Summary

Period covered: 31 August – 4 October 2025

3 minute read

Note: This report summary is one or two months behind the current month as standard reporting practice. The content is indicative only and incomplete with certain data undisclosed. Become a member to access this data or take out a free 30-day membership trial now.

Retail Sales Performance:

Retail sales growth edged up to xx% year-on-year in September according to the Retail Economics Retail Sales Index, in line with the three-month average.

Factors impacting the headline performance in the month include:

Unsettled weather: Warm spells early in the month gave way to rain, strong winds and cooler conditions later in the month. The volatility made seasonal buying more erratic than usual, with milder-than-average temperatures in the early weeks delaying demand for autumn apparel but encouraging last-of-season activity in home and garden.

Lower footfall: Storm Amy disrupted footfall in the final week, particularly on high streets, while a brief dry spell in late September offered only limited recovery. MRI reported a YoY fall of xx% in footfall, with high streets experiencing a xx% decline.

Wardrobe refresh: The mild start to September caused many shoppers to postpone cold-weather purchases. Retailers reported slower sell-through of outerwear, knitwear, and boots, with fashion sales supported instead by promotions and mid-season basics. Footwear growth was steadier, lifted by back-to-school and early winter lines.

Promotions and discount-led activity: September saw a continuation of discounting across non-food. Homewares, electricals and apparel all leaned on markdowns to drive conversion, particularly as seasonal lines proved slow to move.

Electrical retailers pushed trade-in and bundle offers around new smartphone launches, though wider electronics demand was patchy. Shoppers remained price sensitive, meaning value remained the trigger.

Uncertain backdrop: Inflation was unchanged at xx%, driven by rising transport prices but food inflation slowed for the first time in six months. Wages grew by xx%, but unemployment ticked up to xx%. While uncertainty continues, there were signs of resilience as confidence rose back to -xx in October (from -xx in September). This was partly driven by an uptick in the major purchase index, with shoppers gearing up for Black Friday deals.

Underlying uncertainty

The retail sector saw restrained growth in September with total sales rising xx% YoY. Food and beauty offered more stable results while other discretionary sectors delivered mixed results.

Clothing and footwear grew, but at a more subdued pace than earlier in the year. DIY and electricals softened again.

The consumer mood was cautious ahead of the Autumn Budget, and inflation still influenced the composition of spend.

Value-focused behaviours and small comforts remained key buying drivers.

The Bank of England held the base rate in September at xx%, remaining cautious and emphasising the need to continue tackling inflationary pressures.

While inflation defied expectations of a rise to xx%, upward price pressures are not easing quickly enough for policymakers’ comfort.

Food inflation remains a particular pressure, despite official stats showing the first slowdown in inflation for six months. Consumers continue to prioritise budgets carefully and remain squeezed in discretionary categories.

The impending Autumn budget is acting as a drag on sentiment, especially among demographics such as older consumers, who fear tax increases on pensions, and higher earners, who fear an extension of the freeze on tax thresholds.

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Confidence falls back in September