Retail growth ‘fizzled out’ last month, analysts find

Three months of growth in the Scottish retail sector "fizzled out" in June, analysts have found.

Total sales in Scotland decreased by 0.4% compared to June 2024, where they had also decreased by 3.4%, according to the Scottish Retail Sales Monitor.

The Scottish Retail Consortium-KPMG analysis found the figure was well below the three-month average increase of 1.2%, and below the 12-month average rise of 0.1%.

Adjusted for inflation, there was a year-on-year decrease of 0.8%.

Food sales fell by 2.3% last month compared to the same time last year, when they had also decreased by 1.7%.

Total non-food sales rose by 1.1% compared to June last year, when they decreased 4.8%.

Adjusted for the effect of online sales, non-food sales rose by 2.1% in June.

David Lonsdale, Director of the SRC, said: "Three consecutive months of growth in Scottish retail sales unfortunately fizzled out in June.

"Retail sales contracted by 0.4% during the month when compared with the same trading period the year before.

"This was perhaps less than surprising after the slump in shopper footfall in June, and with households continuing to prioritise experiences, such as holidays and concert-going rather than purchases of products."

He added: "Households are having to contend with a multitude of pressures which is seeing them spend selectively.

"Council tax and water bills have soared, inflation is increasing, and shop prices have started to rise.

"All this is putting a dampener on disposable spending.

"Hopefully this downturn in sales will prove temporary as retailers themselves grapple with a hotchpotch of cost pressures of their own, ranging from higher statutory costs for employing people to higher business rates and new levies on packaging."

Linda Ellett, UK Head of Consumer, Retail & Leisure at KPMG, said: "Non-food purchases saw modest growth in Scotland in June as consumers took advantage of summer promotions to buy home appliances and homeware goods, while the weather aided clothing sales.

"But a fall in food and drink spending saw monthly Scottish retail sales slightly down overall.

"Retailers will be hoping that the summer buying is not yet complete and that the pace picks up further in July and August as suitcases get packed and the sun hopefully keeps shining."