Get all your news in one place.
100’s of premium titles.
One app.
Start reading
Daily Record
Daily Record
Lifestyle
Katharine Hay & Rachel Williams

Scottish retail sector edges closer to pre-pandemic levels

January sales in Scotland decreased by almost eight per cent compared to before the pandemic, but have shown an improvement since the Christmas period.

The total number of sales in Scotland dropped by 7.9% compared with January 2020, when they saw an increase by 1.3%.

This figure, however, is above the three-month average decrease of 11.6% and the 12-month average decrease of 10.8%.

January's performance is also an improvement of 5.1% from December last year, and is the lowest year-on-two-year decline recorded since July 2021, according to the latest report by Scottish Retail Consortium (SRC).

The research showed Scottish-only sales had decreased by 3.0% on a like-for-like basis compared with January 2020, when they had decreased by 0.1%, which is above the three-month average decrease of 1.1% and the 12-month average decrease of 8.1%.

Total food sales were on the up last month by 3.3% compared to the same time of year in 2020, when they had increased by 2.7%.

This figure, however, was still below the three-month average growth of 3.5% and the 12-month average growth of 4.3%.

And the total of non-food sales, including childrenswear, men's smart clothing, and furniture, decreased by 17.3% in January compared with the same month in 2020, when they had increased by 0.2%.

This was above the three-month average decrease of 24.2% and the 12-month average decrease of 23.5%.

The figures comes amidst rising costs and inflation across the country (PA)

The report added with the estimated impact of online sales, the non-food sales decreased by 34.0% in January versus the same month in 2020, when they had increased by 1.1%.

Ewan MacDonald-Russell, head of policy at SRC, said it is "too early to tell" if the figures represent the start of a "shopping revival" in Scotland.

The report said given that due to inflation running at historically high levels, a portion of the sales growth will be a reflection of rising prices rather than increased volumes.

Mr MacDonald-Russell said: "January saw the best Scottish sales figures in six months as shops kicked off 2022 with tentative signs of a recovery.

Retail bosses say the figures show an "encouraging start to the New Year" (Getty images)

"Whilst these figures are littered with caveats - the value of sales remain nearly eight percent below pre-pandemic figures and are bolstered by inflation - it's nonetheless welcome to see an improving performance after a dreadful end to 2021.

"However, much of that growth derives from increased inflation which grocers are now being forced to pass onto customers through higher prices."

He said a combination of high inflation, rising public policy costs and stretched household finances are making sales for traders difficult, adding: "Hopefully there will be brighter skies ahead, but it looks it will be sometime until we arrive there."

Paul Martin, Partner, UK head of retail at KPMG added: "An encouraging start to the year is welcome news, but with inflation impacting both consumers and retailers, the months ahead will require a balanced approach to drive growth.

"There are clear signs we're edging closer to traditional trading patterns and sales falling back into line with pre-pandemic levels.

"Normally a quiet trading month, January's strong performance was fuelled by non-food sales, with notable performers including formal office wear, mirroring the return to the office for many.

"It remains to be seen if sales will continue to grow and move towards levels we saw before the pandemic."

He added: "Scottish households will be feeling the pinch in the months ahead, with rising energy and fuel prices being compounded by inflation which is due to peak in April.

"Retailers are facing their own inflationary pressures and will need to take tough decisions on whether and how to pass on the increased costs they have been sitting on for some time to consumers facing their own financial challenges.

"We could easily see the health of the sector start to deteriorate if consumers choose to sit on savings to weather the storm."

Sign up to read this article
Read news from 100’s of titles, curated specifically for you.
Already a member? Sign in here
Related Stories
Top stories on inkl right now
Our Picks
Fourteen days free
Download the app
One app. One membership.
100+ trusted global sources.