Scotland’s retail sector experiences a mild recovery in May amid challenging conditions.
- Overall retail sales saw a modest increase of 0.7% year on year for May 2024.
- Non-food retail sales witnessed a decline both in-store and online, compared to last year.
- Poor weather conditions in May negatively impacted footfall, despite a strong bank holiday weekend.
- The sector remains fragile, despite some growth in specific categories such as beauty and computing.
Retail sales in Scotland during May witnessed a modest recovery after challenging times, with a year-on-year increase of 0.7%. This growth, however, fell short of the 3.9% increase recorded during the same period last year. The data, provided by the British Retail Consortium (BRC) and KPMG, indicates that this month’s growth was above the three-month average of 0.3% but below the twelve-month average of 2.0%.
In contrast, non-food retail sales observed a decline. Over the three months leading to May, there was a 2.4% decrease in these sales compared to a 0.7% growth during the previous year. Moreover, the decline is notably steeper than the twelve-month average, which fell by 1.7%. For May specifically, non-food sectors were particularly affected, with in-store sales declining by 2.7%, although online sales reported a minor increase of 1.5% year on year. The online penetration rate for non-food items rose to 36.7% from 35.9% in the prior year.
The impact of unfavourable weather conditions throughout May contributed significantly to reduced footfall, notwithstanding positive outcomes during the bank holiday weekend, as stated by BRC’s Chief Executive, Helen Dickinson. Dickinson remarked on the only modest rebound in retail sales due to minimal improvements in weather conditions.
Linda Ellett, KPMG’s UK head of consumer, retail and leisure, noted that categories such as health, personal care, beauty, and computing continued to perform well. There was also a slight increase in women’s and children’s clothing sales. Ellett underscored the hope within the retail community that more favourable summer weather and events like Euro 2024 will stimulate consumer purchases.
Despite slight improvements in certain sectors, the overall health of the retail sector remains fragile. As per industry leaders, major investments continue to be postponed, pending a clearer turn in consumer confidence and spending.
The retail sector in Scotland is cautiously optimistic, awaiting clearer signals of consumer confidence for sustained recovery.
