Scottish retail sector 'not yet out of the woods' as dreich May weather hits sales
Scottish retailers are seeing a “slow return towards normality” but total sales remained in negative territory last month, new figures today reveal.
While stores continued to benefit from the relaxation of lockdown restrictions, there was still a 3.6 per cent fall in total sales in May, compared with the same month in 2019, prior to the pandemic, according to the latest sales monitor from the Scottish Retail Consortium (SRC) and KPMG.
Total food sales were up 2.5 per cent on the two-year comparison basis, though that was down on recent highs as pubs and restaurants reopened, eating into supermarket spend.
Once again, non-food sales bore the brunt, falling by 8.7 per cent compared with May 2019.
The move to a two-year comparison from a year-on-year one has been made to provide a more meaningful picture of trading given the rollercoaster ride of Covid lockdowns and restrictions suffered during the bulk of 2020.
Ewan MacDonald Russell, head of policy and external affairs at the SRC, said: “Retailers continue to benefit from the relaxation of lockdown restrictions and the return to shops. However, despite evidence of pent up demand coming through sales still failed to break into positive territory, remaining below the comparable May 2019 figures.
“Food sales remain in growth, albeit slightly reduced as eateries reopen. Online sales fell back with customers returning to stores, but there wasn’t enough of a high street boost to push the figures into positive territory.”
He pointed to weak fashion and beauty sales, “not helped by the dreich May weather and lack of clarity over summer holiday plans” which discouraged consumers from refreshing their wardrobes.
“Hopefully retail is now on a path back to growth – however it’s clear the industry is not yet out of the woods, and with little sign that the lost retail sales of the past 15 months will be recouped,” MacDonald Russell added.
“With sales still negative and the cost of operating under the current restrictions onerous retailers will continue to struggle to be profitable. In that context early sight of the roadmap to removing restrictions and encouraging workers safely back to city centres is a priority for the industry.”
Paul Martin, partner and UK head of retail at KPMG, said: “The retail sales growth we’d hoped for in May didn’t materialise.
“However, there are positive signs for the months ahead. Food sales continue to perform well and non-food sales at bricks and mortar stores improved during the first full month of Scotland’s high streets reopening.
“If poor weather deterred shoppers in May, the warmer conditions we’re experiencing now could turn the tide.
“And while a fall in online sales pulled non-food down overall, it would be wrong to view this as a long-term trend. The overall conditions for Scottish retailers are still in a state of flux.
“We won’t get a clear indication of how shopping preferences have been impacted by the pandemic until lockdown restrictions have been fully lifted. For now, prudent retailers will need to focus on cost and efficiency whilst focusing on their omni-channel future.”