Festive sales offer ‘bleak’ picture for Scottish retailers

● Underlying figures show sales drop by almost 1%, falling for second year running

Scottish retailers suffered a “bleak midwinter” due to stuttering Christmas sales, the latest industry snapshot has revealed.

Headline figures for the crucial five week-period to 28 December showed that total sales in Scotland increased by 0.4 per cent compared with the same period in 2018.

However, the 2019 figures were positively distorted by the late timing of Black Friday, which occurred in December lastyearasopposedtonovember in the previous year.

After adjusting for Black Friday distortions, festive sales slipped 0.9 per cent, marking the second successive year of decline, according to the latest sales monitor from the Scottish Retail Consortium (SRC) and KPMG.

Retail experts cited the underlying figure as “a more realistic picture of the struggle facing the retail industry”.

Christmas food sales were positive as consumers took advantage of a high-profile “vegetable price war”, with grocers slashing the price of traditional holiday staples such as brussels sprouts and parsnips.

Non-food sales returned more of a mixed bag, as kitchen appliances, bluetooth devices and beauty ranges sold well but fashion items performed poorly.

SRC director David Lonsdale said: “It was more bleak midwinter than festive frolics for Scottish retailers as shop takings slipped during the critical Christmas trading period.

“That rounded off a pretty tepid 2019, which saw onlineadjusted sales nudge up by 0.3 per cent across the year.

“Clothing and footwear struggled, in part due to consumers looking to take more financially discerning and environmentally sustainable approaches to their Christmas shopping.

“Customers tended to shop early, around Black Friday discounting, and in the final few days before Christmas – with some retailers reporting as a consequence that Boxing Day sales were slow.”

He added that Scottish retailers will be disappointed but relieved that figures were “a touch more buoyant than elsewhere in the UK”.

With the Scottish Budget due to be announced next month, and the UK Budget to follow in March, Lonsdale urged politicians to focus on keeping consumer costs low and replace the universal business rate with a reformed system.

Paul Martin, UK head of retail at KPMG, added: “The latest figures reflect the overwhelming challenges facing Scotland’s high streets.

“2019 was dominated by the loss of a series of high profile retail names, and it appears the usual pre-christmas rush has failed to significantly turn around fortunes.

“With greater clarity over Brexit and a slight rise in overall business optimism, we could see consumer confidence return, but retailers are facing significant challenges, driven by a range of factors – from a reduction in traditional demand towards new channels, increased costs and continued economic uncertainty.”