Small increase in sales for Scotland’s shops

SCOTLAND’S SHOPS saw a small increase in sales last month despite the depressing effects of miserable weather, according to f igures released by the Scottish Retail Consortium.

The statistics, published today, show that the value of retail sales during June increased by 1.2% compared to the same month in 2011.

But the seemingly encouraging sign disguises a likely fall in volumes due to food inflation — and prompted economists to warn that the sector had “stagnated”.

Food sales increased 3% on last year, but the SRCKPMG joint report warns that once price increases over the 12-month period are taken into account volumes of sales are “likely to have fallen”.

Non-food sales fell by 0.5% during last month.

Clothing and footwear retailers were reckoned to have found June particularly tough, largely because the wet weather hit demand for summer ranges.

That has left shopkeepers praying for the kind of Olympic Indian summer forecasters are tentatively beginning to suggest could be on the cards.

Sales of big- ticket purchases, like electronic equipment and furniture, were also sluggish and promotion-led thanks to consumer caution.

The SRC’s Richard Lim said: “Consumers remain cautious about their personal f inances, and lower temperatures have cooled demand for summer fashions and outdoor leisure goods.

“With shops full of seasonal stock, retailers are hoping a possible Indian summer delivers some salvation.

“Food and drink retailers are faring the best in a weak market but, when inflation is taken into account, volumes of sales are likely to have declined.

“There was a boost in the run-up to the jubilee celebrations as shoppers bought in party foods for the long weekend, but it wasn’t on the same scale as seen in our UK-wide statistics.”

Like- for- like sales remained unchanged on last June, with food sales up 0.9% and non-food revenues dropping by 0.8% across Scotland’s stores.

Scotland’s retail sales were weaker than results for the UK as a whole for the 15th month in a row.

KPMG’s Scottish head of retail David McCorquodale said weak performances could not be solely attributed to the nation’s reduced appetite for jubilee celebrations.

“A number of factors are combining to make times particularly challenging for retailers, and the vast majority are now resorting to heavy and sustained promotional campaigns, which impact negatively on margins, just to tread water,” he said.

Richard Lim