Slight uptick in Scottish retail sales as inflation saps growth
High inflation wiped out virtually any real uptick in retail sales last month, but Scots, who are getting their homes and gardens in good shape in time for the summer, helped push the figure into positive territory.
April sales north of the border were 9.1% higher than a year earlier, the Scottish Retail Consortium said on Wednesday, but adjusting for inflation the figure fell to a 0.3% year-on-year increase.
David Lonsdale, Director of the Consortium, said that “Easter last month provided a slight but welcome boost in retail sales”.
“The real value of retail sales has returned to positive territory after the decline in March, as a result of health and beauty categories and people cleaning up their homes and gardens,” he said.
The real value of retail sales bounced back into positive territory after falling in March, driven by health and beauty categories and home and garden refreshes.
With inflation hitting some of the highest levels on record, part of the sales growth is due to rising prices rather than increased volumes.
Rising prices led to households in Scotland spending more on groceries, while other spending areas were losers, including categories such as clothes and shoes, larger furniture and electronics.
But, Lonsdale said, there are gaps in demand, including for energy-saving appliances, gaming consoles, and gardening and home improvement.
Total food sales increased by 15.4% compared to April 2022 when it increased by 2.9%, while total non-food sales increased by 3.9% compared to April 2022 when it increased by 25.7% % had increased.
Mr Lonsdale said: “While general inflationary pressures and food price increases in particular have hopefully peaked and are set to ease, it is too early to say whether this will be matched by higher spending on more discreet retail products,” he said.
“Finally, Scottish consumers are facing several headwinds that are difficult to resist and which could well weigh on consumer spending, particularly with higher council and income taxes and higher mortgage rates.”
Paul Martin, UK retail director at KPMG, said consumer demand has so far been “fairly resilient to the twin stresses of high inflation and high interest rates” but warned as “government energy support is ending for many and savings are starting to dwindle.” other household bills are rising, the next few months will likely remain challenging as consumers’ tanks drain.”
“Much depends on whether soaring food inflation can be brought under control enough for consumers to be able to comfortably spend on non-essential items again,” Martin said.
“Retailers are hoping that the coronavirus crisis, combined with a month full of bank holidays and easing inflation, will boost consumer confidence enough for real profitable growth.”
https://www.standard.co.uk/business/business-news/slender-uptick-for-scottish-retail-sales-as-inflation-eats-away-at-growth-b1081610.html Slight uptick in Scottish retail sales as inflation saps growth
