UK consumers reject fashion, buy beauty in April says Barclaycard

By

Sandra Halliday

Published
May 8, 2019

UK consumer spending managed to rise 2.5% in April, the latest Barclaycard monthly spending review said on Wednesday. But while that might seem like good news, it offered little comfort to the beleaguered fashion sector, although the beauty sector (as usual) seemed to shake off any worries about weak spending.

The increase was largely about consumers making the most of the warm weather to go out to dine or work on their gardens. Were they interested in shopping for other goods? Not in big enough numbers to make a difference.

That resulted in a 5.2% contraction in fashion spend. Stores didn't seem to be resorting to heavy markdowns, or at least if they were, those markdowns might have encouraged consumers to buy a little bit more as the average transaction value stayed flat year-on-year. That might not seem like a result to shout about, but given that average transaction values could so easily have fallen, we’ll chalk that one up in the good news column.

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It wasn't only clothing that suffered, with the entire retail sector continuing to face challenges and discount stores, electronics stores and department stores in particular struggling. 

If you take essential spending at places like supermarkets and petrol stations out of the equation, overall non-essential spending was up only 1.2%, lower than the rate of inflation. Department stores fell as much as 2%, although it's difficult to know how much the ongoing problems at Debenhams and House of Fraser are skewing the figures at the moment.

Digging deeper into those figures for the clothing sector, Barclaycard said that family clothing was down 5.5%, shoe shops fell a more worrying 6.4%, womenswear was down 4.9% and menswear dropped a hefty 6.8%. Sports shop didn't do too badly in the circumstances with a fall of just 0.02%, and jewellers even managed a 3.9% increase. 

While discount stores dropped as much as 7.4%, gift shops rose a healthy 8.5%. However the star category was cosmetic stores, with an increase of 10.1%.

It was interesting that airline spending fell into negative territory at -4.8%, the lowest figure recorded since Barclaycard started tracking this data. That may not seem hugely relevant to the fashion sector but it’s a sign of consumers reining in big-ticket purchases.

Of course, Brexit could be having an effect, although consumers say it isn't impacting them at the moment. They’re cautious, yes, but 60% of them say they’re making no changes to their already-tight spending plans for now. And April even saw a rise to 33% of consumers feeling confident in the UK economy, compared to 26% in March, perhaps boosted by the Brexit delay.

The Barclaycard data is one of the most reliable sources of consumer spending information as the company processes nearly half of the UK’s credit and debit card transactions, and also adjusts its spending review to take other transactions into account.