Scottish retail sales rise for fourth month in row as grocery inflation hits 24-year high
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Releasing its latest sales monitor, the Scottish Retail Consortium (SRC) said total sales grew by a modest 0.6 per cent in February, compared with the same month last year and once prices had been adjusted for inflation, which remains at historically high levels. Total food sales jumped by 13.3 per cent in value, factoring in inflation, while total non-food sales were up 5.3 per cent, year on year. Grocery sales achieved their biggest uplift in 24 years almost entirely as a result of rising food prices.
David Lonsdale, director of the SRC, said: “Scottish retail sales held up better than expected in February. Whilst the real terms growth rate was admittedly slight it was nonetheless in positive territory for a fourth consecutive month. However, the challenges for retail are far from being in the rear-view mirror and the costs crunch affecting households and firms could make for a bumpy few months ahead.”
He added: “Purchases associated with Valentine’s Day were a stand-out performer, buoyed by sales of cosmetics, fragrances, jewellery, and chocolates. Grocery sales reached their biggest uplift in 24 years albeit this was flattered entirely by rising food prices. By contrast, bigger ticket furniture items fared poorly as did home entertainment appliances which had enjoyed a purple patch through much of the pandemic period.”
Paul Martin, partner and UK head of retail at KPMG, which helps to produce the monthly sales monitor, said: “Consumers continue to hold back on non-essential spending as household budgets remain squeezed. With increases in energy, broadband, mobile phone and council tax bills on the horizon, consumers will continue to take steps to reduce spend where they can - switching where they shop, what they buy, whilst also cutting back on activities, such as eating out and takeaways. The outlook continues to be challenging with falling consumer spending in real terms and, as more people choose to shop by ‘occasion’, retailers will be pulling out the stops for a buoyant Easter and Mothers’ Day.”