Business

Worst January on record for Scottish retail sales


Total retail sales in Scotland decreased by 27.9% year-on-year in January – the worst performance since last April.

The ‘stay at home’ order delivered on 5 January was the primary catalyst for this collapse, as online – either for home delivery or click and collect – was the only avenue available to consumers, with all stores deemed non-essential closed for the rest of the month in all but the outer islands of Scotland.

The latest Scottish Retail consortium (SRC) and KPMG figures showed that total non-food sales fell by 54.8% in January compared to January 2020.

Adjusted for the estimated effect of online sales, total non-food sales were down by 26.4% year-on-year.

However, total food sales were up 4.3% – above the three-month and 12-month average growth of 4%.

Ewan MacDonald-Russell, head of policy and external affairs at the SRC, admitted that 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.”

The First Minister announced plans to publish a revised Covid Strategic Framework next week and signalled that non-essential shops may be the first part of the economy permitted to re-open from lockdown.

SRC director David Lonsdale said this was potentially encouraging news after two months of chopping and changing to the rules affecting retail.

“Progress is being made in bearing down on Covid infections and this will hopefully encourage Ministers to provide much needed clarity on the route back to trading.

“Early priorities for the sector include an indicative timeframe for the re-opening of stores, an easing of the curbs on click and collect and food-to-go takeaway, and re-admitting garden centres and homeware shops to the list of essential retailers.”

Paul Martin, partner and UK head of retail at KPMG , commented that there is growing evidence consumers are pausing big purchases as they wait for a return to a degree of normality later in the year, which is creating additional logistical costs for retailers.

“While the latest data clearly reinforces the precarious position the industry is in, there are some reasons for cautious optimism.

“The vaccine rollout continues at pace and business rates relief has been extended,” he concluded. “For some traders that could be enough to get them through the final stages of this crisis, but it could be too little, too late for others who’ve faced 12 relentless months of difficulty.”



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