Lacklustre seasonal boost means underlying food sales are in decline
Holyrood says first quarter retail growth shows economy is in steady growth
A late Easter helped April’s food sales figures but growth was disappointingly slow. Those were the findings of the Scottish Retail Consortium KPMG Scottish Retail Sales Monitor, which measured food sales as 1.1% up on April 2013, when they had decreased 1.4% on the previous year. Easter was in April this year, but in March in 2013.
David McCorquodale, head of retail at KPMG, explained: “April’s bounce back due to a late Easter was more muted than hoped for in Scotland, reminding us how hard retailers are working to drive sales growth in this slowly recovering economy.
“Total sales in Scotland for the three months to April fell by 0.7% on the prior year, mainly driven by negative trends in the food sector, which fell by 1.4%.
“This, set against an increase of 1.5% in food sales for the 12 months to April 2014, reflects the harsh realities of the grocery sector. Targeted discounting may be great for consumers, but I fear it will have longer term consequences for suppliers.”
David Lonsdale, director of the SRC, was encouraged by the wider retail sector: “A broader range of indicators crucial to the health of Scotland’s retail industry have begun pointing in a more positive direction. Sales and footfall are both up, and the number of empty properties has fallen.”
The Scottish Government’s own figures show upward movement. The Retail Sales Index for Scotland for the last quarter showed a year-on-year increase of 2.4% by volume and 2.5% by value. Compared to the previous quarter, sales were almost static.
Finance secretary John Swinney said: “The statistics show that retail sales performance has continued to grow over the past year, highlighting steady signs of economic growth.
“This builds on our most recent GDP figures, which show that the Scottish economy grew by 1.6% during 2013 – the fastest annual growth since 2007.”
After the release of the Hollyrood retail figures SRC’s Lonsdale said: “Government can assist the industry through supportive policies which keep a tight lid on those costs under its control and which impact on retailers, such as business rates, taxes and regulation.”