• Text size      
  • Send this article to a friend
  • Print this article

Retail sales growth weaker in Scotland

SCOTTISH retail sales volumes grew 0.8 per cent in the second quarter but this was only half the rate of increase in Great Britain as a whole, official figures have revealed.

sales VOLUMES UP: But retail growth in Scotland in the second quarter is only half that of Britain. Picture: Colin Mearns
sales VOLUMES UP: But retail growth in Scotland in the second quarter is only half that of Britain. Picture: Colin Mearns

The rise in Scottish sales volumes in the second quarter represented a significant acceleration from an increase of 0.1 per cent in the opening three months of this year.

But the figures, published by the Scottish Government yesterday, also show year-on-year growth in retail sales volumes in Scotland in the three months to June was much weaker in Scotland than south of the Border.

In Scotland, retail sales volumes in the second quarter were up 2.9 per cent on the same period of last year.

In Great Britain as a whole, sales volumes in the three months to June were 4.5 per cent higher than in the same quarter of 2013.

Industry surveys, published by the Scottish Retail Consortium (SRC) and British Retail Consortium, have in recent times consistently shown weaker year-on-year movements in the value of sales north of the Border than elsewhere in the UK.

SRC director David Lonsdale said yesterday that the reasons for more modest growth in retail sales in Scotland could include a more marked recovery in the housing market in other parts of the UK driving a greater uplift in sales in home and household-related categories, and the general strength of London and south-east England.

Dougie Adams, economic adviser to the EY Scottish ITEM Club think-tank, believed the weaker sales growth north of the Border might be a consequence of Scottish consumers having reduced the proportion of income they saved last year by more than their counterparts elsewhere in the UK.

He said: "The national accounts data showed there was a bigger dive in the Scottish savings ratio last year than in the UK savings ratio. I suspect it is just one of those wobbles along the way - that Scots dipped into their pockets more deeply last year."

He added: "It is kind of what we had in our forecast. We thought the savings ratio had fallen more sharply in Scotland and therefore, there would be a resting period because of that, because it had got a bit ahead of itself... This year is a bit of a catch-up in terms of the savings ratio."

David Bell, professor of economics at the University of Stirling, meanwhile highlighted signs in the Scottish Government data of continuing pressure on the big supermarkets.

The figures signal a second consecutive quarter of year-on-year decline in shop prices in Scotland.

And quarter-on-quarter growth in sales volumes for large retailers with at least 250 employees, at 0.5 per cent, was way adrift of a 1.3 per cent increase for their small and medium-sized counterparts.

Large retailers have performed significantly worse than their small and medium-sized counterparts over the last few quarters, according to the Scottish Government figures.

Mr Bell said: "What this does show is big pressure on the large supermarkets in Scotland.

He highlighted the scale of the difference between overall growth in sales volumes in Scotland and Great Britain as a whole.

Mr Bell said: "They say it is driven by consumption - the recovery. It is not so obvious it is retail consumption in Scotland. The signs are clearer for Great Britain."

Mulling the contrasting growth in sales volumes in Scotland and Great Britain as a whole, he said the figures might be skewed, to some extent, by London and the south-east.

Although year-on-year growth in sales volumes in Scotland in the second quarter was much weaker than that in Great Britain as a whole, Mr Lonsdale said: "The increase in retail sales over the past 12 months is heartening."

Euan Murray, relationship ­director at Barclays' corporate ­banking division in Scotland, also saw positives in the figures.

He said: "Scotland's retail sector is building on the momentum of a ­positive first quarter despite mixed reports across the market.

"Retail parks continue to ­outperform the high street but both have benefited from the impact of a late Easter and the onset of summer holiday shopping."

In terms of value, the official figures show Scottish retail sales rose 0.6 per cent during the second quarter, to be up 2.6 per cent on the same period of last year.

Contextual targeting label: 
retail

Commenting & Moderation

We moderate all comments on HeraldScotland on either a pre-moderated or post-moderated basis.
If you're a relatively new user then your comments will be reviewed before publication and if we know you well and trust you then your comments will be subject to moderation only if other users or the moderators believe you've broken the rules

Moderation is undertaken full-time 9am-6pm on weekdays, and on a part-time basis outwith those hours. Please be patient if your posts are not approved instantly.

252978