Retail sales in Scotland decreased by more than a quarter compared to the same time last year, a new report has revealed.
The Scottish Retail Consortium (SRC), in conjunction with KPMG, has revealed the following points:
- In January, Scottish sales decreased by 25.2% on a like-for-like basis compared with January 2020, when they had decreased by 0.6%. This is below the 3-month average decrease of 16.7% and the 12-month average decrease of 13.4%.
- Total sales in Scotland decreased by 27.9% compared with January 2020, when they had increased by 0.9%*. This was below the 3m average decline of 18.1% and the 12m average decline of 15.3%. Adjusted for deflation, the decrease was 25.7%.
- Total Food sales increased 4.3% versus January 2020, when they had increased by 2.2%. January was above the 3-month and 12-month average growth of 4.0%. The 3-month average was below the UK level of 7.9%, while the 12-month average was below the UK’s levels of 6.1%.
- Total Non-Food sales decreased by 54.8% in January compared to January 2020, when they had decreased by 0.2%. This was below the 3-month average decline of 36.7% and the 12-month average decline of 31.3%
- Adjusted for the estimated effect of Online sales, Total Non-Food sales decreased by 26.4% in January versus January 2020, when they had increased by 1.8%. This is below the 3-month average decline of 16.4% and the 12-month average decline of 16.8%. Those are lower than the UK’s 3m average decline of 5.6% and 12m Total average decline of 5.8% respectively.
ONS Senior Statistician Hannah Finselbach said:
“Retail sales rebounded strongly in January following four months of consecutive falls.
“This was driven by a robust month for food sales, which saw their largest rise since March 2020. Supermarkets, alcohol and tobacco stores as well as specialist shops like butchers and bakers all reported strong trading.
“However, clothing shops and household goods stores had less of a successful month with retailers reporting lacklustre sales due to weak consumer confidence.
“Looking at the broader picture, retail sales have decreased across the three-month period and are below pre-pandemic levels.”
Ewan MacDonald-Russell, Head of Policy & External Affairs, Scottish Retail Consortium, said: “January’s Scottish sales figures show shops remain trapped in the depths of a dark and dismal winter. Spending plunged as shops were forced to shutter shops and, in many cases, discontinue click and collect services. The figures were the worst monthly performance since April and the worst ever January results and lengthened the run of failing sales figures to twelve successive months.
“There was little positive to report, with the only significant growth in food sales, albeit in the context of no competition from eating out as a result of the closed down hospitality trade. Conversely there was bad news across non-food stores, with physical non-food retail seeing sales fall by half. Furniture retailers were feeling the pain after missing out on a key season; and other retailers continue to have to contend with immense logistical pressures as the lack of notice and ever-shifting regulations put exceptional pressure on operational models.”
Charlie Huggins, Manager of the Quality Shares Portfolio at Wealth Club commented:
“Retail sales volumes came in much better than expected in January, but this was largely due to a significant recovery in food sales. Non-food stores saw sales decline by 1.3%, with clothing sales especially weak – hardly a sign that consumers are feeling flush.
The large increase in food sales is clearly a positive for supermarkets, but it may be a worrying sign for other parts of the economy. More people eating at home is especially bad news for restaurants, pubs and bars. These sectors are in dire need of footfall, with their costs set to rise significantly in April following the Autumn Budget.
The decline in clothing sales – the worst performing category in January – is also a worry. Clothing is one of the first things consumers cut back on when they are feeling the pinch.
Overall, aside from the major supermarkets, few retailers will cheer these figures. With inflation still elevated, and the dire state of government finances suggesting further tax rises could be on the cards, UK consumers are unlikely to be splashing the cash in 2025.”
