Weather: Storms dampen festive sales

A lot of the spending was due to the lure of discounts. Picture: Ian Gerogeson

The gales and heavy rain over the festive period led to a fall in 2013 Christmas shop sales when compared with the previous year, new figures reveal today.

Scottish retail sales decreased by 1.1 per cent in December last year when compared with December 2012.

The disappointing figures for what is traditionally a lucrative time for retailers were revealed in the Scottish Retail Consortium (SRC) KPMG Scottish Retail Sales Monitor, which publishes its December results today.

The slight slump in year-on-year festive sales was in contrast to recent end-of-year figures, which had shown an improvement in recent years. December 2012 had seen a 1.5 per cent increase in shop sales on 2011.

When December 2013 figures were broken down, it was found that food sales were down by 0.3 per cent on 2012 and non-food sales were down by 1.7 per cent.

The Retail Sales Monitor also found Scottish figures fared worse than the UK as a whole for December. The UK saw sales growth of 1.8 per cent in December last year when compared with December 2012.

David McCorquodale, KPMG’s head of retail, said: “On the face of it, the Scottish sales ended a year of recovery on a negative note. A combination of an extremely competitive market in the food and drink sector and gales in the few days before and after Christmas dampened an otherwise positive year.”

Mr McCorquodale suggested that improving retail figures would not be experienced until pay packets improved. He added: “Despite a stronger summer, these Christmas figures are a stark reminder that, while things may feel better in confidence terms, consumers spend cash and not confidence.

“Better days will only hit the high street when wage rate inflation takes off.”

David Lonsdale, Director of the Scottish Retail Consortium, said: “The overall trend for sales in 2013 was generally positive. However, these figures show a small setback in December which will be disappointing news for Scottish stores but will hopefully prove shortlived.

“There are some categories where the news has been better than others. Clothing and footwear had a strong month, for example. Scottish consumers have continued to update their wardrobes with new items, and retailers that have offered good ranges have benefited.”

Although clothes and shoe sales did better than other categories, much of the success was driven by discounting, which will have an affect on profit margins. The position in the week of Christmas Day was cited as a reason for falling food sales.

It meant that more shopping for Hogmanay celebrations will fall into the January trading period than last year. Beer and party food were among the stronger performing items.

The SRC KPMG Retail Sales Monitor also looked at “like-for-like” sales, which excludes spending in stores that opened or closed in the intervening year. The measure is often used for comparison by analysts who want to discount the distorting affect of changes in shop floorspace. In December 2013, like-for-like sales were down by 2.9 per cent when compared with the previous year.

Where possible, the Scottish figures did include online sales. But given that some large companies collate their online date on a company-wide basis, it was not possible to come up with a precise Scottish figure in all cases.

Of the online figures that could be calculated, it was found that online and non-store sales added 2.4 percentage points to the total growth of all UK non-food sales in December 2013.

Further analysis of the data found that there was good demand for electric and electronic devices, from tablets and video game consoles to TV sets and cooking appliances, many of which were purchased with discounts.