Festive food and drink sales provide sustenance to waning Scots retail sector

It was Scottish grocers’ best return in more than two years, according to the latest retail sales monitor from KPMG and the Scottish Retail Consortium (SRC).

However, total retail sales were slightly down in December, compared with the same month in 2014.

But the drop of 0.2 per cent was still the best performance for almost two years.

Like-for-like sales, which strip out factors such as new store openings, decreased by 0.4 per cent, according to the Scottish Retail Consortium (SRC)-KPMG retail sales monitor.

Total Scottish sales increased by 1.8 per cent when adjusted for deflation.

Clothing and footwear was the worst performing category as the weather stayed unseasonably warm, while storms and flooding meant shoppers plumped for online purchases over trips to the high street. Total Scottish sales were down 0.2 per cent compared with December 2014, the best performance since January 2014.

Like-for-like sales, a figure which excludes trading at outlets opened since last December, fell by 0.4 per cent.

When online sales are factored in, total non-food sales rose 1.8 per cent. Adjusted for deflation, total Scottish sales also went up 1.8 per cent.

SRC director David Lonsdale said this increase was largely driven by purchases of food and drink in the run up to Christmas.

Mr Lonsdale said: “Grocery sales recorded their best monthly performance in over two years, while non-food categories such as home accessories, electrical goods and beauty products also did better.

“Indeed ‘other non-food’ was the best performing category during the whole of 2015, driven in part by improvements in the housing market.

“By contrast clothing and footwear sales in December returned its weakest performance for four months.”

Mr Lonsdale said it was too early to say whether December’s gains would turn out to be the start of a more sustained recovery for retailers, adding that the industry was still adapting to changing consumer habits and falling prices.

SRC has been vocal in calling for the Scottish Government to step in and help retailers, issuing a series of policy papers ahead of May’s Holyrood elections.

Among other things, it has proposed more frequent revaluations of business rates and relief for firms whose premises are being refurbished, and has banged the drum for greater regulatory consistency across Scotland.

Today Mr Lonsdale urged the next government to prioritise policies which support consumer confidence, including ensuring greater certainty over council tax reform and the new Scottish income tax.

David McCorquodale, head of retail at KPMG, said: “With business rates and the implementation of the national living wage keeping a focus on the costs of running a retail business, it is imperative that the politicians in an election year allow consumers to feel confident and retailers to focus on product rather than red tape.”