Shoppers holding back on high street spending
Retailers are pinning their hopes on a rise in pay packets to help reverse a slide in sales.
Shoppers spent 1.2% less in the shops in October compared to the same month last year, but David Lonsdale, director of the Scottish Retail Consortium, says there is more money around.
The bright spots were solid demand for gaming and beauty products as well as the overall positive contribution of online sales, helping sales in the non-food category record its second highest growth of the past six months.
However clothing and footwear sales were sluggish during the month, and food and drink sales continued to wilt further despite good demand for Halloween related fare.
Lonsdale said: “Looking forward, retailers will be heartened by the news that growth in average pay is now outstripping inflation for the first time in five years. Shopkeepers will be hoping that this – alongside sustained rises in footfall over recent months – translates into greater levels of confidence and transactions as we approach the important Christmas trading period.”
David McCorquodale, head of retail at SRC’s survey partner KPMG, said: “October was a difficult month for Scottish high street retailers, particularly for those selling heavy coats and boots. Wet and wild at the start, the month ended with a hot Halloween – neither the best conditions for a positive consumer reaction to the promotions on offer. The winners were the games sellers and home accessory retailers, where weather plays less of a role.
“Fashion and footwear retailers, who started the year so well, will be concerned with the higher stock levels they are holding now but will do their best to hold their nerve to drive volumes and margins in the six week lead up to Christmas. The food retailers continued the negative trends that have been such a feature of the year to date and will be disappointed to feel the gap widening against the rest of the UK for the last three months rolling.
“With six weeks to go and festive adverts on our screens, the annual dance between retailer and consumer has begun. Significant investment has been made across the channels during the year and ‘tis now the season to put them to the test.”