The latest sales monitor from the Scottish Retail Consortium and KPMG indicates the decline in consumer spending gathered pace in August when total sales fell by 0.9% compared with the same month last year, after dropping 0.7% in July.
As consumer spending accounts for a big share of activity the reported decline in sales does not bode well for the Scottish economy.
The monitor shows retailers enjoyed contrasting fortunes in August.
The success of the Olympics provided a big fillip for sales of goods like crisps and beer that people could consume while watching the games on TV. The good weather from the middle of the month spurred sales of barbecue food.
Total food sales increased by 2.4% annually.
However, the gains enjoyed by food and drink retailers were more than cancelled out by a slump in non-food sales, which fell 4.1% annually.
"It's clear the Olympics created a feel-good factor but also a major distraction from shopping. People who were watching on TV or following online were not visiting shops or retail websites," said Richard Lim, economist at the consortium.
Mr Lim noted Scotland underperformed the UK for the 17th month in a row. Total sales increased by 1.6% annually in the UK.
Stripping out the effect of changes in floor space, like-for-like sales fell by 2.7% annually in Scotland but by only 0.4% in the UK.
Some consumers in Scotland appear to be shelving purchases of big-ticket items. The consortium said sales of furniture and flooring remains depressed.
However, there were bright spots in the apparent gloom.
The monitor reported "healthy" sales of fitted kitchens. The authors said some householders who may be unable to move amid sluggish housing market conditions are improving their existing properties instead.
On the other hand sales of household accessories were down. "It's likely the excitement of the Olympics detracted some shoppers from the usual maintenance and renewal in the house," said the authors.
While men's sports shoes were in strong demand on the back of the Olympics, sunny weather hit sales of new autumn and winter clothing ranges. But women's footwear items such as brogues and pumps sold "particularly well".
David McCorquodale, head of retail in Scotland, KPMG, said: "August is traditionally a weak month for sales and it's really the next three months that will have a critical impact on retailers' profitability."
He highlighted the difficulty of making forecasts amid the volatile conditions facing retailers.
A Scottish Government spokesperson said: "Our latest [Scottish Government] Retail Sales Index shows that the retail sales performance over the year con-tinues to show growth in Scotland, but with a small fall in the volume and value of retail sales in the second quarter of 2012.
"The retail sector can be assured we are working to maintain Scotland's position as the most supportive business environment in the UK."
Scotland re-entered recession in the first three months of 2012, with a second successive quarterly fall in output.