Period covered: July 20Published: August 19, 2020Read time: 1min

Scottish Retail Sales Monitor

Slow Return for Stores Hinders Sales

Ewan MacDonald Russell, Head of Policy & External Affairs, Scottish Retail Consortium:

“Scottish sales continue to underperform with a real terms fall of 7.1 percent. Although some high street stores were open throughout July, those in shopping centres, as well as hospitality businesses, were only permitted to open in the second half of the month as a result of the prolonged lockdown in Scotland. Those closures, along with difficult economic conditions appear to have impacted on both footfall and high street sales.

“Food sales were actually quite close to what would be expected in July, albeit food retailers were only competing with hospitality businesses in the latter two weeks. Summer party and barbeque food did well as Scots sought outdoor food whenever the mixed weather permitted.

“Non-food sales remain heavily driven by home spending. Consumers continue to look for technology, kitchen appliances, and homeware products as they spend more time working and living at home. There was a positive uptick in larger items, perhaps a result of stores being open and consumers able to try out products. However, online non-food sales continue to be higher than previous years and it’s clear many shoppers are now settled into using digital channels.

“Whilst these figures are a significant improvement on the dire numbers from full lockdown, they are still lower than expected for this time of year. Furthermore, even with some pent up demand it’s likely the lost sales from Spring and Summer will not be recouped. For retailers taking very complex and costly measures to keep customers safe the next few months are likely to be very challenging, and regrettably we may see further businesses stumble under the unprecedented pressure they are facing.”

Paul Martin, UK Head of Retail, KPMG:

“The latest figures highlight the scale of the challenge ahead for Scotland’s retailers. With store sales down 8.3% year-on-year, we’re witnessing a recovery of sorts, but at a worryingly low pace. Once again, food sales have helped to mitigate some of the losses in the industry, with fashion retailers continuing to struggle as consumers focus on essential purchases.

“September is typically one of the strongest months of the year for Scottish High Streets, so there will be a great deal of nervousness as we approach this period with furlough schemes tailing off and local lockdowns and travel restrictions continuing to put people off returning to a degree of normality. The industry is facing an uphill battle for survival. The next few months could be a crucial make-or-break period for many.”