UK April Non-Food Retail Sales -3.3%; Dual Pressure from Easter Timing and Consumer Confidence

Overview

This report interprets the British Retail Consortium (BRC) April retail sales monitoring data. UK April non-food retail sales fell 3.3% YoY, while total retail sales declined 3.0%. The report notes that the shift in Easter timing this year (Good Friday week counted in March rather than April) was the primary driver of the sales decline, though the BRC also pointed out that weak consumer confidence impacted the results. After adjusting for timing factors, the average growth rate for non-food sales in March-April was -1.2%, a significant slowdown from January's +1.7%, indicating pressure on the demand side of UK retail.

Core views

Sales Data: April non-food retail sales were -3.3% YoY, with online sales at -2.3% and store sales at -4.0%. Food sales were -2.5% YoY. Non-food online penetration reached 37.9%, up 50 basis points YoY; apparel online penetration was also 37.9%, up 150 basis points YoY, indicating online channels continue to erode store share. Category Divergence: Within non-food sales, Health & Beauty performed best and was the main growth driver; Apparel and Footwear performed weakest. Within online channels, Health & Beauty, Home Textiles, and Home Accessories were the fastest-growing segments. Trend Changes: Excluding the impact of Easter timing, the average growth rate for non-food sales in March-April was -1.2%, showing a slowdown compared to January's +1.7% and February's -0.4%. This trend is below the expectations of the Goldman Sachs UK Household Available Cashflow (HAC) model, which forecasts UK consumer discretionary spending growth of +0.1% in 2Q26, followed by -0.7% and +1.6% in the third and fourth quarters, respectively.

Analysis framework

Goldman Sachs employs a timing adjustment analysis: first identifying the interference of Easter timing changes on monthly data (this year's Good Friday week counted in March BRC statistics vs. last year in April), then calculating the adjusted March-April average growth rate to eliminate seasonal distortions, thereby more accurately judging real demand trends. Simultaneously, the report compares sales data with Goldman Sachs' proprietary UK Household Available Cashflow (HAC) model for validation. The HAC model tracks changes in UK household disposable cash flow to forecast consumer discretionary spending trends. The report notes that current sales trends are below HAC model expectations, reflecting the suppression of consumer spending power by slowing wage growth, a soft labor market, and rising fixed costs. Additionally, the report uses a channel breakdown method to analyze online versus store sales performance and penetration rate changes separately, helping investors understand structural shifts in retail channels.

Methodology notes

• Industry/Sector Analysis FrameworkVolume-Price Split

  Timing Adjustment Analysis

  When holiday timing falls into different statistical periods in different years, data must be adjusted to eliminate seasonal distortions to more accurately judge real demand trends. This report smooths the impact of Easter timing changes by calculating the March-April average growth rate.

• Industry/Sector Analysis Framework

  Disposable Cash Flow (HAC) Model

  Forecasts consumer spending power by tracking changes in household disposable cash flow. When wage growth slows, employment weakens, and fixed costs rise, HAC growth slows, putting pressure on discretionary spending. The report uses this model to verify whether sales data aligns with macro consumer capacity expectations.

• Industry/Sector Analysis Framework

  Channel Penetration Analysis

  Judges structural shift trends in retail channels through online penetration (online sales as a percentage of total sales) and its YoY change. Rising penetration indicates online channels continue to erode store share, posing pressure on pure offline retailers.

Key data

• April Total Retail Sales YoY-3.0%Coverage period: April 5, 2026 to May 2, 2026
• April Non-Food Retail Sales YoY-3.3%Impacted by Easter timing shift
• April Food Sales YoY-2.5%Decline smaller than non-food
• Non-Food Online Penetration37.9%+50bps YoY
• Apparel Online Penetration37.9%+150bps YoY
• April Non-Food Online Sales YoY-2.3%Outperformed stores
• April Non-Food Store Sales YoY-4.0%Decline larger than online
• Adjusted Mar-Apr Non-Food Sales Average Growth-1.2%Significant slowdown from Jan's +1.7%
• 2Q26E UK Discretionary Spending Forecast+0.1%From Goldman Sachs HAC model
• 3Q26E/4Q26E Discretionary Spending Forecast-0.7%/+1.6%Reflects slowing wage growth and rising fixed costs

Impact & implications

For the UK retail industry, April data indicates continued pressure on the demand side. Although the Easter timing shift was the main disturbance factor, the trend remains significantly slower than early-year levels even after adjusting for timing, and is below Goldman Sachs HAC model expectations, suggesting that weak consumer confidence is a real structural issue. The triple pressure of slowing wage growth, a soft labor market, and rising fixed costs is suppressing UK consumers' discretionary spending power. At the category level, Health & Beauty showed relative resilience, while Apparel & Footwear faced significant pressure, reflecting greater consumer caution on non-essential spending. At the channel level, online penetration continues to rise, putting greater pressure on pure offline retailers. The report notes that the Restaurants and Entertainment/Culture sectors have recently been the main beneficiaries of HAC growth, indicating that service consumption is more resilient than goods consumption.

Risks

• Further slowing wage growth may suppress consumer spending power
• Deterioration in the labor market could lead to a contraction in discretionary spending
• Rising fixed costs continue to squeeze household disposable cash flow
• Persistently weak consumer confidence may prolong the retail sales slump

What to watch

• Whether subsequent months' BRC retail sales data continue to fall below HAC model expectations
• Changes in UK wage growth and employment data
• Whether the Health & Beauty category can continue to lead non-food sales
• Whether the pace of online penetration growth slows down
• Whether the HAC growth benefit for the Restaurants and Entertainment/Culture sectors can be sustained