Little festive cheer for Scots stores as takings slip for sixth month despite strong toy sales

The poor weather may also have been a reason for the disappointing December sales numbers.The poor weather may also have been a reason for the disappointing December sales numbers.
The poor weather may also have been a reason for the disappointing December sales numbers.
Reduction in national insurance and council tax freeze could boost consumer confidence in 2024.

There was little festive cheer for Scotland’s retailers after sales fell for the sixth month in a row during December.

Industry leaders said the “shine came off” the so-called “golden quarter” of trading, covering the build-up to Christmas and immediate post-festive sales, when stores generate the bulk of their profits. Releasing its latest sales monitor, the Scottish Retail Consortium (SRC) said that what growth there was in sales had been outpaced by rising shop prices.

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Despite a surge in last-minute festive purchases and discounting by retailers, many shoppers continued to pare back spending as concerns lingered over the cost of living and higher mortgages. Total sales by value fell by 2.4 per cent in December, once adjusted for the effects of inflation, compared with the same month a year earlier. It means that retail sales north of the Border have now fallen for six months in a row, measured in real terms.

SRC director David Lonsdale said: “The bright spots were toys, gaming consoles, cosmetics, and online purchasing. Grocery sales fared well too albeit December was the weakest monthly performance in food of last year and much of the growth was a consequence of food inflation. Non-food categories overall declined with fashion, household appliances, furniture, and electricals all struggling.

“As the spotlight turns to the year ahead it remains to be seen whether customer confidence and spending will be lifted by reductions in employee national insurance contributions and the council tax freeze.”

Total food sales increased by 5.5 per cent year on year in December, before adjusting for inflation, while total non-food sales fell by 1.1 per cent, according to the latest figures. Adjusted for the estimated effect of online trading, non-food takings were down by 1.9 per cent.

Paul Martin, partner and UK head of retail at KPMG, which helps to produce the monthly sales monitor, added: “While the festive season allowed for a rise in food sales growth, albeit at the slowest rate of the year, this was the only hopeful note. We can now only look forward to a stronger 2024 but be cautious of ongoing uncertainties due to a range of factors from upcoming elections to product availability.”

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