Scottish high streets frozen out as retail sales hit skids

Published on Tuesday 16 March 2010 20:23

SCOTTISH retailers suffered their worst February in 11 years, as consumer confidence waned and snowy weather kept shoppers indoors.

• Picture: TSPL

Overall, like-for-like sales were down 1.1 per cent on the year – the worst February performance since the Scottish Retail Consortium (SRC)/KPMG Scottish Retail Sales Monitor began in 1999.

The news comes just days after figures showed that Scotland's coldest winter in almost half a century cost small firms north of the Border 716 million in lost income. The winter of 2009-10 – the second coldest ever recorded – hit revenues at seven out of ten small firms, the lifeblood of the economy, the Bank of Scotland said on Monday.

Richard Dodd, at the SRC, said yesterday that bad weather and customer caution had delivered "grim" retail sales data.

He said: "After extreme weather kept shoppers at home in January, Scottish retailers were hoping for a revival in February, but continuing cold and snow denied them the bounce back that was achieved in other parts of the UK.

"Scotland's coldest February since 1986 combined with economic and political uncertainty to hit non-food sales hard. Generally, it was a month for buying needs not wants."

Non-food sales tumbled 2.6 per cent on a like-for-like basis, while food sales rose 0.5 per cent. In contrast, the thaw in the rest of the UK allowed retailers to recover some of January's losses. UK sales were 2.2 per cent higher than in February 2009, when they fell 1.8 per cent.

Some sectors of the Scottish retail market bucked the trend. Sales of confectionery enjoyed a boost with Valentine's Day and the cold weather meant winter vegetables, stews and soups did well.

However, the cold snap meant sales of new spring/summer clothing ranges got off to a slow start. Footwear sales were weaker than they had been in January, too, when many people bought boots for the snow.

Homewares and do-it-yourself suffered another difficult month as the freezing temperatures meant many people put off discretionary purchases until travelling conditions improved.

David McCorquodale, head of retail in Scotland for KPMG, the accountant, said the figures were "perhaps the first sign of a noticeable and concerning trend in the Scottish market place", despite the fact that "optimistic" retailers could attribute the downturn to the weather.

"February last year was also impacted by snow and so the results are perhaps the most comparable that we have had for a few months now," he said. "The increased VAT rate, the uncertain jobs outlook and the prospect of a hung parliament following the general election all have a bearing on confidence.

"Retailers will be very focused on driving the right promotions and products in the lead-up to Easter and the bank holidays that follow."

Total sales – generally used to assess the growth of the entire retail industry – rose 1.9 per cent north of the Border. That was also the weakest since the survey began, and was less than half the 4.5 per cent rise notched up across the UK.

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