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    The UK Is Off The Hook, But The Electricity Market Is Surprisingly Good. Why?

    2019/3/25 22:49:00 5043

    Britain Off EuropeElectricity SupplierMarket Sales

    According to foreign media reports, IMRG IMRG Capgemini e-Retail Sales Index (Index) showed that the unusual warm weather in February led to the strongest growth in electricity sales in the UK in 6 months.




    Although the year-on-year growth rate in February was lower than the 5 annual average level of 10.6%, this growth has provided some spiritual comfort to online retailers in Britain after the recent difficulties.




    It is reported that under the influence of warm weather, horticultural products sales growth is particularly prominent, an increase of 33.3% over the same period last year.

    In addition, sales of health care and beauty products also showed a good performance. Sales grew by 13.4% over the same period last year.

    By contrast, the sales of gifts and appliances in this month are not so satisfactory, sales decreased by 27.6% and 15.4% respectively, and sales of clothing (+0.9%) were basically the same as before. This may be due to retailers' premature sales of spring clothing.




    Reaction in the retail market




    "February is usually a pitional month. When the new year has just passed, online or offline clearance activities are continuing.

    Interestingly, online conversion rate increased by 20% in February compared with the same period in 2018, but sales increased by only 9%. This was mainly due to the uncertainty of Britain's withdrawal from Europe and the upcoming increase in interest rates, which led to consumers' cautious shopping mood. People began to buy some essential products and discount products, instead of buying some conceptual products and high priced goods.

    This has also affected the sale of electronic products and gift products. The prices of these two categories of commodities decreased by 15% and 27% respectively this year.

    Capgemini retail customer participation chief consultant Bhavesh Unadkat said.




    In addition, Andy Mulcahy, director of IMRG strategy and market insight, pointed out that since July 2018, retailers have been in a difficult and special trading environment, and discount has been very common in retailing.

    After the clearance season in January 2019, many businesses began to stop discounting, or at least began to reduce the proportion of discounts, and multi-channel retailers seemed to have succeeded in achieving this change.

    The sales volume of online sellers with entity stores is almost 3 times that of pure electricity providers, and the average value of shopping cars can also explain the problem. In February, the average value of shopping vehicles on multi-channel e-commerce websites dropped by 7%, while that of pure electric providers decreased by 17%, indicating the pure electricity supplier's dependence on discount.




    Economists had previously predicted that falling confidence and tighter household finances would prompt UK consumers to cut spending in the first few months of 2019, but the data do not have much impact on consumer spending.




    Rhian Murphy, head of retail sales at the National Bureau of statistics, said: "in the 3 months ended February, retail sales in the UK continued to rebound, and fuel sales and online shopping growth were strong."

    Earlier, data showed that the UK employment market remained dynamic this year, and employment and wage growth were faster than inflation.




    "The February retail data show that the main factor affecting the family spending in the UK is the growth of real wages, rather than the uncertainty caused by the UK's withdrawal from Europe," said Samuel Tombs, chief economist of Pantheon Macroeconomics, a consultancy.




    Samuel Tombs predicts that even if Britain has no agreement to return to Europe, the tight labor market and low interest rates in Britain will keep British consumers spending steadily in the second quarter.

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