Total retail sales saw a +2.7% year-on-year boost in January, driven by New Year and seasonal discounting, the latest British Retail Consortium (BRC)-KPMG figures reveal.

“A drab December gave way to a brighter January as retail sales picked up pace,” Helen Dickinson, the BRC’s Chief Executive, said. “Many shoppers had held off Christmas spending and waited for the January sales, with the start of the New Year showing the strongest growth.”

Covering the 4 weeks to 31 Jan 2026, food sales increased by +3.8% compared to 2025. However, the outlook for 2026 indicates that food inflation will persist. “Shopper concerns are well-founded – as a result, we expect [them] to continue to scrutinise purchasing,” commented Sarah Bradbury, CEO of IGD.

Non-food sales also saw an uptick, rising +1.7% year-on-year, which was above the 12-month average growth of 1.1%. This increase was driven by strong performance across personal electronics, furniture and children’s clothing and toys.

Linda Ellett, UK Head of Consumer, Retail & Leisure at KPMG, said the January sales had enticed consumers to spend. But she warned that despite this, “many retailers remain acutely aware of the challenge of consistently growing sales volumes when consumers continue to be cautious about – and savvy with – spending.”

“While retailers welcomed the increase in spending, many challenges remain in 2026,” Dickinson continued.

“Consumer confidence, while improving, remains weak; costs of energy and packaging are rising, and the new Employment Rights Act could limit the ability of retailers to offer more flexible jobs,” said Dickinson. “The Government must focus on getting the last of these right – ensuring protections for workers without damaging the availability of the jobs themselves.”