Scotland business

Scottish retail sales 'return to growth'

Image caption The consortium said shoppers continued to feel the impact of inflation and low wage growth

Retail sales in Scotland have returned to growth but underlying trends have changed little, a survey has suggested.

The Scottish Retail Consortium (SRC) said like-for-like sales in July were 0.2% higher than a year ago, while total sales were up 1.7% on the same period last year.

The survey indicated growth was driven last month by improved sales of food and drink.

But sales of non-food goods fell for the third consecutive month.

The SRC reported food sales picked up after a tough June, while clothing and footwear showed a clearance-led improvement but remained lower than a year ago.

Homewares were also mostly down on a year ago and often promotion-driven.

The consortium, which carried out the survey in conjunction with KPMG, said consumer caution continued to hit big-ticket housing-related purchases.

'Positive news'

Richard Dodd, from SRC, said the general return to sales growth was positive news for Scottish retailers but should not detract from the underlying weakness in consumer spending.

He continued: "Shoppers continue to feel the impact of high levels of inflation and low wage growth as households' real incomes shrink. The VAT increase and the effects of cuts have also dented consumer confidence.

"What growth there was in July came from food and drink, partly due to better weather later in the month but also to the effect of inflation on top-line growth.

"Sales of non-food goods fell for the third consecutive month as consumers shunned non-essential buying."

He added: "With public sector job cuts likely to hit hard and unemployment forecast to rise this year and next, conditions on the high street are likely to remain tough in the run-up to Christmas."

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