Retailers ‘on the brink’ as Scottish sales slump by more than a quarter

Many of Scotland’s retailers have been brought “to the brink” amid the continued lockdown after sales slumped by more than a quarter last month.

The vast majority of retailers have had to close due to the coronavirus lockdown restrictions and there are fears many may struggle to reopen. Picture of a virtually deserted Buchanan Street in Glasgow by John Devlin

The latest sales monitor from the Scottish Retail Consortium (SRC) and KPMG found total sales in Scotland were down 27.6 per cent in May, compared with the same month last year, although this was an improvement on the record slide of more than 40 per cent recorded in April – the first full month of lockdown.

Total food sales increased by 3.6 per cent for May 2020 compared to 12 months ago, with grocery retailers reporting a higher basket spend than before the Covid-19 crisis. But there was a 53.2 per cent plunge in total non-food sales.

Ewan MacDonald Russell, head of policy and external affairs at the SRC, said: “While the figures were an improvement on April’s record low, restrictions on trading are bringing many retailers to the brink.

“Non-food sales remain very weak, with online sales increasingly important. Games and electricals continue to perform well, and we saw a rise in kitchen appliances as households turn to cooking and home-baking in the absence of eating out.

“Fashion and footwear sales continue to struggle as school children and office workers don’t need to worry about workwear. Large items also performed poorly, at least in part as consumer confidence remains very weak due to uncertainty about employment and the economy.

“The current crisis is forcing retailers who are currently barred from opening to accelerate the move to online and multi-channel sales. When combined with weak consumer demand and confidence there is a real risk of entering a vicious economic cycle where reduced retail, hospitality, leisure, and other sales leads to more pressure on businesses through the supply chain which leads to fewer workers.

“It’s therefore essential we have a clear and unambiguous indicative timetable for high streets re-opening, a clear plan so shoppers can travel to and shop safely in town and city centres, and a short term economic stimulus package to encourage consumers to start shopping again.”

A Scottish Government announcement tomorrow is expected to usher in a phased reopening of more retailers north of the Border.

Paul Martin, partner and UK head of retail at KPMG, added: “June could become a crucial month as the sector, and consumers, come to terms with a very different looking high street.”

The sales monitor comes as a survey by ScotPulse found that the vast majority of Scots will continue to buy local once lockdown is eased.

Some 89 per cent of consumers polled said they intend to buy locally once current restrictions come to an end – with just 2 per cent admitting they plan to reduce the amount of local shopping they do. But Scots are divided on the prospect of returning to pubs.

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