Like-for-like sales fell 1.6% in the year to March, compared with March 2007 when sales rose 3.9%.
The decline was the worst since July 2005 when cold wet weather hit sales, the BRC said.
“Here is the strongest evidence yet that customers are making serious economies and are increasingly concerned about the future,” said Stephen Robertson, director general of the BRC.
Meanwhile, factory gate prices rose at their fastest pace for 17 years last month, according to the Office for National Statistics. Prices rose at 6.2%, driven by higher oil and food prices.