Scottish small firms buck UK-wide trend of falling sales in key trading period, report from Xero finds

One business says shoppers want authenticity and connection, which “comes naturally” to small firms.

Alexandra Borthwick (pictured), founder of Made Scotland, says smaller firms offer a sense of connection, 'something that big corporations struggle to provide'. Picture: contributed.

Scottish small firms have bucked a UK-wide trend of falling sales – instead seeing a jump in tills ringing, as well as a boost in wages.

Data from global small business platform Xero found that smaller Scottish firms had a “more encouraging” sales result than the UK picture, with 4.1 per cent year-on-year growth in the December quarter, the fourth consecutive three-month period in which it has led the gains.

Across the UK, the figure was a 1.6 per cent year-on-year jump compared to 9.7 per cent in 2022, and retail proving the worst performer with a 5.3 per cent drop, in a period Xero noted is traditionally when firms expect bumper festive sales. It added that late repayments remained an issue, with small firms found to have been paid, on average, 6.1 days late during the last three months of 2023.

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In terms of employment, Scotland averaged slightly more small business jobs than a year ago in the December quarter, up by 0.4 per cent, while wages grew at a similar clip to the national average, at 3.3 per cent. Alexandra Borthwick, founder of Scottish online marketplace Made Scotland, said: "Business was good for [us] over the festive period, reflecting a continuing shift in shopping habits, as more consumers look to buy more sustainable produce from small, local businesses.” She also said shoppers are seeking authenticity and connection, adding: “This comes naturally to small businesses, whether they’re interacting at markets or creating a community on their social media, and that connection is something that big corporations struggle to provide."