In the period covering 29 October to 25 November, total sales in Scotland rose by 3.1% compared to November 2022, a stark contrast to the previous year’s growth of 8.0%. This increase falls short of the 3-month average of 4.2% and the 12-month average of 7.8%. When adjusted for inflation, these figures translate to a concerning year-on-year decline of 1.2%.

The details of these sales figures reveal a nuanced picture. Like-for-like sales in Scotland experienced a modest increase of 3.8% over the same period last year, yet this too lags behind the 3-month and 12-month averages. Food sales, though up by 5.8% from November 2022, did not meet the 3-month and 12-month average growth rates, indicating a slowdown even in this essential sector.

Non-food sales tell a similar story of deceleration. While November saw a 0.9% increase compared to the previous year, this was again below the average growth rates. Furthermore, when adjusted for online sales, non-food sales actually decreased by 0.2%.

Ewan MacDonald-Russell, deputy head at the Scottish Retail Consortium, commented: “These figures are concerning for hard-pressed retailers many of whom desperately need a good last quarter of 2023 to get them through the traditionally fallow months at the start of next year.

“Retailers already know they will be facing large increases in wage costs in the new year. If the Scottish Government doesn’t take action in it’s upcoming Budget to meaningfully blunt a rise in business rates then shops will very likely have to make very difficult decisions in 2024 to balance the books.”

Paul Martin, partner and UK head of retail at KPMG, said: “In the final month of the year, economic conditions continue to test consumer resilience, and with sales growth struggling, the emphasis on price as the primary purchasing driver is evident.

“We are likely to see a prolonged and strategically targeted period of discounting as retailers vie for a diminishing pool of consumer spending and aim to clear their stock.

“The critical golden quarter in Scotland has already experienced two months with sales growth below 3%, making it a weak Christmas trading period. The prospect of excess stock remaining unsold before Christmas raises the possibility of substantial January sales, potentially exerting even more pressure on already tight profit margins.

“Looking ahead to the early months of 2024, the challenges are expected to persist, posing a threat to the sector and potentially leading to more casualties, especially for online retailers facing over 28 consecutive months of sales decline.”