'Dreich' Sales For Retailers In January As Shoppers Tighten Budgets

15 February 2017, 06:34

edinburgh shoppers

Retailers experienced ''dreich'' sales last month as shoppers tightened the purse strings following the festive period.

In January, Scottish year-on-year sales dropped 3.2% on a like-for-like basis (which excludes new store openings) compared to January 2016, when they had decreased by 4%.

Total Scottish sales were down 3.5% compared with January 2016, when they had declined by 3.8%, according to the Scottish Retail Consortium-KPMG Scottish Retail Sales Monitor for January 2017.

The figure was below the three-month and 12-month averages, both -1.3%.

After being adjusted for deflation, measured at 1.7% by the BRC-Nielsen shop price index (SPI), January sales declined by 1.8%.

Scottish Retail Consortium director David Lonsdale said: ''These are somewhat dreich retail sales results for January, showing a dip of nearly two per cent even when falling shop prices are taken into account.

''After the extravagances of the festive period, which saw solid sales growth in December and indeed during the final few months of last year, shoppers were clearly keeping a firmer grip on purses and wallets in January and focusing more on essential spending as lower footfall data for the period suggested.

''With the Chancellor's Spring Budget and commencement of the Brexit negotiations just a month or so away, Scotland's retailers will be looking for measures which help them keep down prices for consumers and for the prioritising of tariff-free trade with the rest of the EU; especially on everyday staples such as food and clothing.''

Total food sales last month were down 2.6% on January 2016, when they had decreased by 5.8%, with last month's growth the lowest since then.

Meanwhile, total non-food sales declined 4.3% compared to January 2016, when they had decreased by 2.1%.

Adjusted for the estimated effect of online sales, total non-food sales decreased by 1.8% against January 2016, when they had increased by 0.2%.

On a three-month basis, the online-adjusted total non-food change was 0.5%, above the UK average of 0.3% for the second month in a row.

Craig Cavin, head of retail in Scotland at KPMG, said: ''Having splashed out over the Christmas period, shoppers were keen to save money, despite the sales bringing prices down.

''As Hogmanay was included in January's figures this year and December's last year, total food sales fell by 2.6%.

''Non-food products saw the largest percentage fall year on year (4.3%), with clothing and footwear's poor performance condemning them to the bottom of the rankings in January.

''Returned Christmas gifts and January sales may have hurt profitability, but a later return to school meant children's clothing performed better than adults'.

''The popularity of buying electricals and health and beauty products appears not to be just for Christmas, with demand for both sectors bucking the trend of non-food decline.''

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