IMRG online shopping index – online retail sales drop by 12%

International software engineering company IMRG’s online retail index has shown online retail revenue growth has fallen by 12% year on year.

With the end of pandemic restrictions it seems that the boom that many online retailers enjoyed over two years is over. IMRG strategy and insight director Andy Mulcahy said of this, the online retail space is “not in the healthiest space”.

Despite this, average basket value (ABV) has grown to record levels, reaching a high of £146 in April. Clothing orders ABV grew by 10% to £80 in the most recent quarter compared to last year. As a whole, the sector has seen growth of 4.2% and as such is the only segment of online retail to see growth.

All other categories saw negative growth – electrical saw a 17.8% drop, home and garden, 22.8% and health and beauty 32.8%. As the UK emerged from the pandemic, so its population have been hit by high price inflation and a concurrent cost of living crisis. This is likely to lead to a slump in online as well as offline shopping. The figures from IMRG are a hint of trends to come.

Many last mile delivery companies have invested in massive extra capacity in both workforce and infrastructure, and we have already seen this overcapacity hitting profits in recent quarterly financial reports. With the slump in retail, this may well be set to impact the sector has a whole for quite some time to come.

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