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Scottish Christmas retail sales return to growth

Retailers in Scotland reported a return to sales growth for Christmas 2016.

The Scottish Retail Consortium (SRC) reported a 4.3% rise in like-for-like sales in December, compared with a 0.4% fall in December 2015.

However, an increase in food sales – up 2.5% – was offset, by a drop in non-food sales of 0.7% in December compared with 2015. Nevertheless, this was an improvement on the 12-month average decrease of 1.8% and driven by a rebound in clothing and footwear, said the SRC.

Adjusted for the estimated effect of online sales, total non-food sales increased by 2%, compared with 1.8% in December 2015.

Ewan Macdonald-Russell, head of policy and external affairs for the Scottish Retail Consortium, described the non-food results as “positive”.

“It’s encouraging to see another good month’s performance, which builds on a good November, and continues the autumn trend of a small but now sustained recovery in retail sales,” he said. “Non-food sales were also positive, although once again online sales were responsible for the sales growth. As expected there were good sales of mid-priced items, with fragrance and mobile phone gifts performing well.

“However, while a good Christmas is a real boost to Scottish retailers, there are some worries ahead. A number of economic indicators suggest that inflation is affecting input costs for retailers, and that’s already starting to feed through to the High Street. Those costs also mean that whilst total sales value may rise, that may not correlate with an increase in retail profits. Consequently both customers and retailers are likely to continue to feel the squeeze over the early months of 2017.”

Craig Gavin, KPMG’s head of retail in Scotland, commented: ”The timing of Christmas also gave shoppers an extra day to grab last-minute gifts which, coupled with relatively calm weather in the weeks prior, all point towards favourable conditions for retailers. Online sales of home accessories, beauty products and toys played an important role in driving the 2% boost in non-food sales.”

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