Scottish retail sales increased by 0.2% on a like-for-like basis last month compared to June 2016, but fell by 0.2% on a six-month basis, according to the Scottish Retail Consortium.
Total sales in Scotland fell by 0.5% compared to June 2016, with non-food sales declining by 4.2%.
However, total food sales increased by 4.2% compared to the same month last year, when they had increased by 0.1%. This pulls the twelve month averages to 1.5%, which is the fastest growth since April 2014.
Disappointing Results
“A disappointing June for retailers as nervous customers continue to postpone discretionary spending due to squeezed household incomes and worries about the economy," said Ewan MacDonald-Russell, head of policy and external affairs at the Scottish Retail Consortium.
Although food sales had a strong performance in June, he added that "it’s clear that growth derives from cost pressures from imported goods, resulting from the fall in the value of sterling".
“Our concern is inflation on essential goods is now forcing cash-strapped consumers to put off discretionary spending which exacerbates the pressure on shops. With a quarter of a million Scottish retail jobs it’s crucial the Scottish Government carefully considers the impact on spending and the health of the retail industry when they consider income tax rates later this year.”
Summer Spending
Earlier this week the British Retail Consortium reported that consumer footfall in the UK increased by 0.8% in June due to the warm weather in many parts of the country. However, this was not the case in Scotland, where poor weather conditions impacted sales growth.
“We should know not to rely on summer sunshine in Scotland or risk disappointment, but a gloomy month has taken its toll nonetheless," said Craig Cavin, KPMG's head of retail in Scotland. "The effect of Scotland’s wettest June in over a century was felt across the industry."
© 2017 European Supermarket Magazine – your source for the latest retail news. Article by Sarah Harford. Click subscribe to sign up to ESM: The European Supermarket Magazine.
