Total sales in Scotland increased by 4.4% compared with July 2021, when they had grown by 7.4%.
The latest Scottish Retail Consortium (SRC) and KPMG data showed that this was above the three-month average increase of 3.5%, but below the 12-month average growth of 15%. Adjusted for inflation, there was no year-on-year change.
Scottish sales increased by 2% on a like-for-like basis, compared with last July, when they had increased by 6.2%. This is below the three-month average increase of 2% and the 12-month average increase of 12.1%.
Total food sales increased by 5.3% year-on-year last month, with July above the three-month average of 3.2% and the 12-month average growth of 0.5%.
Total non-food sales increased by 3.7% in July compared with last year, when they had increased by 12.1%. This was below the three-month average increase of 3.8% and the 12-month average of 27.1%.
Adjusted for the estimated effect of online sales, total non-food sales increased by 1.9% in July year-on-year. This is above the three-month average growth of 0.3% and below the 12-month average of 18.3%.
SRC deputy head Ewan MacDonald Russell explained that in real terms, Scottish retail sales flatlined in August, as a modest rise in the value of sales was wiped out by the impact of record rising inflation.
“Retailers did see shoppers changing their food shopping to purchase more outdoor food to take advantage of the sunshine – but that was instead of other purchases.
“It was a similar story for high street retailers, as while summer clothing and items sold well, that was very much at the expense of other items.“
He added that the more shoppers cut back on discretionary spending, the more difficult things will become for already beleaguered retailers.
“Those businesses are also dealing with huge inflationary pressures which are exacerbating the difficult trading environment - unless the Scottish and UK Government take swift action, it may be a bitter winter for Scotland’s shopkeepers.”
Paul Martin, partner and UK head of retail at KPMG, commented: “As margins continue to be challenged, and costs continue to rise, a significant drop in demand during the autumn will negatively impact the health of the retail sector.
“Successful retailers will need to carefully anticipate customer buying patterns in the months ahead, and make sure they balance their offering with the right products, prices and promotions.”
Don't miss the latest headlines with our twice-daily newsletter - sign up here for free.
