Tough outlook for shops as high street suffers

Scotland’s retailers face an “incredibly challenging” trading environment, with total sales in August down sharply on a year earlier, figures today reveal.
David McCorquodale: 'Weather, for once, was not to blame'. Picture: ContributedDavid McCorquodale: 'Weather, for once, was not to blame'. Picture: Contributed
David McCorquodale: 'Weather, for once, was not to blame'. Picture: Contributed

The latest sales monitor from the Scottish Retail Consortium (SRC) and KPMG shows that takings were down by 2.4 per cent compared with August 2014 when they were boosted by events like the end of the Commonwealth Games.

Like-for-like sales, which exclude any spending in stores which opened or closed in the intervening year, were down by an even sharper 2.9 per cent on last August, when they had decreased by 1.7 per cent.

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When adjusted for deflation measured by the BRC-Nielsen Shop Price Index, total Scottish sales decreased by 1.1 per cent.

David Martin, head of policy and social affairs at the SRC, said: “Despite an uptick in consumer confidence, August sales performance pales in comparison to the like-for-like performance a year earlier when major events, like the finale to the Commonwealth Games, helped to drive footfall.

“Although retailers had a tougher time during August getting consumers to spend, the three-month rolling average for total sales was the best recorded since May and suggests a general improvement across the longer-term. Nevertheless, the trading environment remains incredibly challenging for retailers, especially for those selling food.”

David McCorquodale, head of retail at KPMG, added: “Despite being against a relatively strong post-Commonwealth Games, pre-referendum comparative for August 2014, the decline in sales in August is worse than both the three-month and the 12-month averages.

“The usual culprit to blame for poor sales – the weather – was not at fault as both temperatures and sunshine hours were at or above average for the month.”

When adjusted for the estimated effect of online sales, total non-food sales decreased by 0.5 per cent on August 2014, when they had increased by 2.8 per cent, their second fastest growth in 2014, excluding Easter distortions.