SCOTTISH retailers are lamenting a disappointing Christmas, as new figures show sales in December were well adrift of the same month in 2022.
Total sales in Scotland increased by 1.9% over the five weeks from November 26 to December 30, compared with December 2022, when they had grown by 11.3%, figures released by the Scottish Retail Consortium today reveal. This was below the three-month average increase of 2.6% and the 12-month average growth of 6.9%.
The SRC noted that the sales figures released today are not adjusted for inflation, meaning that a portion of the sales growth in December reflect rising prices rather than increasing volumes.
Its Scottish Retail Sales Monitor was issued at the start of a busy week of Christmas trading updates from the major retailers, with Marks & Spencer, Tesco, Sainsbury’s, and B&M all due to report to the City in the coming days.
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Last week, Next revealed sales had sparkled at Christmas and upgraded its profit the guidance for the year, while JD Sports reported that it had a more challenging festive period. It cited milder than expected weather and a high level of promotional activity in the market as it said sales had come in below expectations.
David Lonsdale, director of the SRC, said: “There was little Christmas cheer for Scotland’s retailers as the value of retail sales in real terms dwindled in December. The shine came off the ‘golden quarter’ of trading in the final three months of 2023 as once again what growth there was in sales was outpaced by rising shop prices. Despite a surge in last minute festive purchases and discounting by retailers, overall shoppers continued to pare back spending as concerns lingered over the cost of living and higher mortgages.”
The SRC reported that total food sales increased by 5.5% versus December 2022, when they had increased by 11.5%. Total non-food sales fell by 1.1% compared with the corresponding month in 2022, when they had increased by 11%.
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Paul Martin, partner and UK head of retail at survey sponsor KPMG, said: "A tough year for the retail sector in Scotland was bookmarked by a fall in growth during December to the lowest level of the year.
“While the festive season allowed for a rise in food sales growth, albeit at the slowest rate of the year, this was the only hopeful note. Despite some rays of light via strong sales in cosmetics and fragrances, due to early discounting, non-food item sales dipped as the cost of living crisis continued to bite.
“We can now only look forward to a stronger 2024 but be cautious of ongoing uncertainties due to a range of factors from upcoming elections to product availability."
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