Last-minute Christmas rush looking 'decidedly uncertain' after bleak November for Scotland's retailers

Scotland’s retail sector has suffered another bleak month, with a last-minute Christmas rush now looking “decidedly uncertain” amid tougher Covid restrictions, industry leaders have warned.

New industry figures, released today, show that total sales north of the Border increased by 2.6 per cent last month compared with November 2020. However, on a two-year comparison basis, total sales continue to perform well below pre-pandemic levels - down 13.4 per cent compared with November 2019.

Ewan MacDonald-Russell, head of policy at the Scottish Retail Consortium (SRC), which produces the monthly sales monitor together with KPMG, said: “November was less Black Friday and more bleak winter as Scottish retail sales slipped by 13.4 per cent compared to pre-pandemic trading.

“This is deeply concerning for the industry who have seen weak and disappointing trading for the first two months of the golden trading quarter. With the Omicron variant of Covid now posing a question about consumer demand and going out, the prospects for strong trading in the final days up to Christmas look decidedly uncertain.”

Shoppers pictured on Edinburgh's famous Princes Street. Picture: Jane Barlow/PA Wire

The sales monitor showed that total food sales decreased 2.2 per cent last month compared with a year earlier. On a two-year comparison, total food sales grew 2.5 per cent though this was below the three-month average growth of 3.3 per cent.

Total non-food sales increased by 6.7 per cent in November compared with the same month in 2020 and on a two-year comparison were down by 26.8 per cent.

Adjusted for the estimated effect of online sales, total non-food sales fell by 7.5 per cent in November versus the same month last year.

MacDonald-Russell added: “Retailers are trading in intensely difficult conditions with consumers facing rising costs and an uptick in uncertainty with the rise in Covid cases. It’s therefore disappointing the Scottish Government failed to provide the support necessary for retailers in last week’s Budget.

“That looked like a short-sighted decision at the time, and these figures provide further proof the industry would have benefitted from support.

“If trading doesn’t improve substantially or if restrictions are placed upon the industry or shoppers in the near future, then Scottish Ministers will need to revisit this approach if they don’t want to deal with the consequences for stores or the health of our retail destinations in 2022.”

Paul Martin, partner and UK head of retail at KPMG, said: “Scotland’s high streets dominated sales growth in November, helped by the fact consumers were given extra confidence by the vaccine and booster roll out, and were motivated to secure the gifts they wanted for Christmas at physical stores rather than online.

“Retailers will be hoping consumer confidence builds in December and will be keeping a very close eye on the Scottish Government’s Covid-19 updates, as we head into the vital few shopping weeks before Christmas.

“As we look ahead to the new year, rising costs continue to bite into margins. Supply chain issues have impacted the availability of goods, leaving retailers with very little room for the mega discounting events we have seen in previous January sales.”

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