NEW sales figures from Scotland’s high streets are “stronger than expected” despite suffering a drop in March, retail chiefs said.
Total sales in Scotland last month were 2.5 per cent lower than they were in March 2013, while like-for-like sales - which strip out factors such as new store openings - have fallen by 3.8 per cent.
That compares to a drop of 0.3 per cent in total sales for the UK as a whole, with like-for-like sales down by 1.7 per cent.
Figures released last week showed footfall on Scotland’s high streets was down 2.1% compared to last March.
Late Easter hits food sales
In Scotland total food sales decreased by 3.5 per cent compared to last March, although the timing of Easter - which was celebrated in March last year but April this year - was said to have impacted on this.
Total non-food sales for last month were 1.8 per cent lower than 12 months ago, according to the latest Scottish Retail Consortium (SRC)-KPMG retail sales monitor.
But sales of clothing and footwear were up from the previous year, although the sector suffered a record decline 12 months ago due to freezing temperatures.
The later timing of Easter this year also had an impact on sales of furniture and home accessories, which are often bought during the holiday period.
SRC director David Lonsdale said that while the figures show a fall in sales, they were “stronger than expected” given the later Easter.
He added: “A particularly strong performance in the fashion and footwear categories shows that shoppers are taking advantage of popular new collections on offer. Scottish retailers are working hard to respond to what customers want in this sector, and it is paying dividends.
“Unsurprisingly compared to last year, categories that perform strongly over the extended Easter break have seen lower sales. Household accessories and furniture are often key purchases over the holiday, and have seen a decline.”
Household income matching inflation
Looking further ahead, Mr Lonsdale said retailers “will be buoyed by the news that household income has finally caught up with inflation for the first time in nearly six years”, although he added: “The crucial factor is whether this trend will continue and also translate into higher levels of confidence and more transactions.”
David McCorquodale, head of retail at KPMG, said: “The timing of Easter - April this year, March last year - distorts the sales figures and exaggerates the decline in Scottish sales.
“The weather this year has been kinder and more spring-like compared with the icy blasts of last year, which has meant that clothing and fashion retailers have fared better in the first quarter of 2014 compared with last year. More favourable economic indicators are also helping to gently loosen some purse strings.”
He added: “Total food sales in Scotland for the three months to March fell by 1.2 per cent compared with a decline of 0.6 per cent in the rest of the UK, hinting that the Scottish consumer is being cautious and canny in spending on necessities, and perhaps being more alert to the discounting of the grocers.
“This is clearly a very competitive area of the market and customer loyalty will be tested to the full as the price wars launched by some grocers take effect. The winner here will be the consumer, and possibly other retail categories, should there be extra pennies to spend.”