Retail sector enjoys best sales in over a year

Industry bosses described the result as upbeat. Picture: Lisa Ferguson
Industry bosses described the result as upbeat. Picture: Lisa Ferguson
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Scottish retailers have enjoyed their best month of sales in more than a year but the trading environment remains “challenging”, according to a report out today.

The latest sales monitor from the Scottish Retail Consortium (SRC) and KPMG shows that total takings rose by 0.7 per cent year-on-year last month, after adjusting for deflation. It marks the sharpest rate of growth since August 2014, barring Easter distortions, and follows robust shopper footfall figures for September, released earlier this week.

Industry bosses described the result as “upbeat”, despite September’s figures being up against a soft comparable period last year with the worst performance of 2014. Excluding the effects of Easter, retailers achieved their best performance since October 2014.

Non-food categories including clothing and footwear underpinned the rise in sales. Unlike other parts of the UK, the growth was not positively distorted by the inclusion of a bank holiday.

Furniture and homeware categories also performed well in September as students, returning for the new term, stocked-up on essentials.

Like-for-like sales, which strip out factors such as new store openings, closures and price inflation/deflation, fell by 1.7 per cent compared with last September, when they had slumped by 4.2 per cent.

David Martin, head of policy and external affairs at the SRC, said: “Although September’s retail figures were up against a soft comparable period last year with the worst performance of 2014, it doesn’t detract from what was an upbeat month for retailers especially in the non-food categories.

“Looking ahead, the trading environment remains challenging for retailers not least in terms of the excessive burden of government-imposed operating costs, however they will be hoping to capitalise on improvements in consumer confidence in the lead up to the Christmas period.”

David McCorquodale, head of retail at KPMG, added: “September saw better sales figures but retailers will not be getting carried away.

“Food sales continued to decline in real terms as they have for the last 22 months, excluding Easter distortions, and much has already been said about the challenges in the grocery sector.

“With the gap widening against the rest of the UK, retailers in Scotland expect a lot of hard work ahead to achieve a reasonable Christmas season. Pricing and promotions will play a key role in driving demand and margin.”

Today’s report comes after it emerged yesterday that shoppers are enjoying cheaper prices at the tills as supermarkets vie to undercut their rivals.

Groceries now cost 1.7 per cent less on average than a year ago, saving the average shopper £58 over that time, according to analysts at Kantar Worldpanel.

The rise of discounters Aldi and Lidl has played a key role as the traditional supermarket giants are forced to slash prices.