Rise in food sales mitigate a miserable month for Scotland's high street
Cold, wet June weather has been blamed for a reported like-for-like retail sales stagnation on Scotland's high street.
The Scottish Retail Consortium figures show zero growth in like-for-like June sales, though a better result than the 1.8 per cent fall recorded in June of last year.
The June figures mark the fifteenth straight month UK sales have exceeded performance north of the border, the SRC said.
Figures for the rest of the UK show like-for-like sales rose by 1.4 per cent in June and by 3.5 per cent in total.
However, food and non-food sales recorded for the UK cover a three-month period from April to June.
Scotland's high street also reported a drop of 1.2 per cent in total retail sales in May compared with a 3.4 per cent rise for the rest of the UK.
Like-for-like non food sales in June were down 0.8 per cent on a year ago, though food sales lifted an otherwise miserable month for the high street, up 0.9 per cent on last year.
Total sales for June were up 1.2 per cent on last year, though again, a three per cent rise in food sales offset a 0.5 per cent fall in non-food.
The SRC said although food sales have risen on last year, volumes are likely to have fallen when food inflation is taken into consideration.
Seasonal retail has also suffered as a result of exceptionally wet weather in June, though food and drink in general was given a “slight boost” from Jubilee products.
Consumer caution is also continuing to affect big ticket retail sales, resulting in more promotion-led sales.
Richard Lim, an economist with SRC, said: “Food and drink retailers are faring the best in a weak market but when inflation is taken into account, volumes of sales are likely to have declined.
“There was a boost in the run up to the Jubilee celebrations as shoppers bought in party foods for the long weekend but it wasn’t on the same scale as seen in our UK-wide statistics.
“This is the fifteenth month in a row that retail sales growth in the UK has outstripped Scotland, although the gap has narrowed.
“Retailers are discounting aggressively to encourage shoppers through their doors and to maintain the many thousands of jobs which depend upon the sector.
“Falling inflation offers some hope with signs that the squeeze on real disposable incomes are easing, but a fundamental revival in consumer spending may be some way off yet.”
David McCorquodale, KPMG's head of retail in Scotland, added: “On first appraisal, June appears to have been a better month for Scotland’s retailers, with total sales increasing slightly by 1.2 per cent on the corresponding period in 2011.
“However, this statistic does not tell the whole story for retailers as much of that rise comes from increased food sale values which continue to be driven by inflation rather than volumes.
“Yet again Scotland’s retail performance was weaker than the UK as a whole and this cannot be entirely attributed to the nation’s reduced appetite for Jubilee celebrations, which provided a fillip to retailers in other regions of the UK.”
The Scottish Government's own retail figures, published in May, suggested a rise in both volume and value sales, which put Scottish retail sales volumes ahead of the rest of the UK at 0.6 per cent and 0.4 per cent respectively.
Its Retail Sales Index (RSI) also suggested value sales in Scotland had risen by three per cent on an annual basis, and for the 2011 year, the RSI figures pointed to a 3.5 per cent rise in the value of Scottish retail sales for 2011 compared with 3.4 per cent growth for the rest of the UK.
However much of the rise in value sales comes from the reclassification in how RSI is calculated, which was introduced in 2007.
This led to automotive fuel sales being reclassified as a retail activity and repair of personal and household goods reclassified out of retail sales.