Shops see slight rise in summer visitors but winter fears for retailers
Footfall in Scotland was slightly up in August
Shops in Glasgow and Edinburgh saw a "modest" improvement in the number of people coming through their doors last month, although visits are still well down on pre-pandemic levels, according to latest figures.
The Scottish Retail Consortium reports footfall was up 1.7% on July in August, but compared against historic trends it was down by 14.8% on three years ago, and with a bigger drop than the UK average decline on 12.4%.
Footfall in shopping centres in Scotland was down by 20.7% in August 2022 compared with 2019, a weakening on the decline of 19.2% in July this year.
SRC said the figures are compared with pre-pandemic levels in 2019 (Yo3Y) to enable meaningful comparisons to be made, as, since the pandemic started, much of retail has bounced between being open and closed which has had a significant impact on footfall.
Best in four months
SRC director David Lonsdale said: "August saw a slightly more upbeat set of figures for visits to stores in Scotland and the best performance for four months, with concerns about galloping household energy bills not enough to keep Scots away.
"Buoyed by the return of holidaying, social occasions and tourism, the modest improvement in shopper footfall was felt across most retail destinations and especially in Edinburgh and Glasgow. Shopping centres however continued to struggle.
Cost of living fears
"Despite the improvement, visits to stores remain well down on pre-pandemic levels and Scotland continued to lag the 12 other parts of the UK surveyed for a fourth month in a row.
"That's worrying given inflationary headwinds and the likely impact on consumer sentiment and spending power, more so in the lead-up to what is traditionally the crucial golden trading quarter for the industry in the final months of the year."
In August, footfall in Glasgow decreased by 11.6% (Yo3Y), while in Edinburgh it was down 11.1% compared with three years ago.
Christmas caution
Andy Sumpter, retail consultant EMEA for Sensormatic Solutions, said: "Despite the heatwave and the ongoing train strikes cooling shopper numbers for periods during the month, August footfall on the whole remained resilient, with performance improving against pre-pandemic levels compared to July, boosted in part by August staycations and rising tourist numbers returning.
"However, whilst the outlook for August remained cheery, retailers will be looking ahead to the autumn - and retail's Golden Quarter of Christmas trading - with an air of caution as the cost-of-living crisis continues to play out, and they wait to see what packages of support will be offered to consumers to ease the burden on household budgets once the new prime minister is announced next week."
How energy costs are fueling the cost of living crisis
Interest rates and inflation go up
Inflation rose by 8.8% in the 12 months to January 2023, down from 9.2% in December 2022. With interest rates also rising to 4%, those saving money will earn more interest on their finances, whilst those paying mortgages would pay more interest to the bank.
Energy bills
The price of energy went up incredibly as the cost of living crisis hit, with the gas price spike caused largely by the war in Ukraine. The price cap - which is set by an independent regulator to help offset costs onto customers - was set to rise to £3,549 for an average home in October but a price freeze from the government restricted the typical bill to £2,500. That's still an increase of 27% from the previous energy cap and as it's a cap on unit cost, the more energy you use the higher your bill will be.
Food prices
The cost of a weekly shop also has gone up as a result of the cost of living crisis. As a result of the war in Ukraine, a number of products including cooking oils and wheat have been disrupted. This means that several products are now considerably more expensive, driving bills up for customers.
Prices at the pumps
The average cost of petrol has also rose to unprecedented levels. Supply lines for petrol have been thrown into doubt as a result of the war in Ukraine, as Russia is a large export partner for gas, oil and fuel. In April 2022, the average price for a litre of petrol on the forecourt was 160.2p, whilst a litre of diesel would cost 170.5p. By late June 2022 the price had risen to an average of 190.9p for a litre of unleaded and 198.9p for a litre of diesel. In March 2023 the price wass on average of 147.03 in petrol and 167.04 in diesel.
Average cost of filling up a car with petrol hits £100
On 9th June 2022, the average cost of filling up a car with petrol hit £100 for the first time ever. Diesel had already hit that milestone. It comes as the cost of fuel hit a record high of one pound eighty a litre. The 2p rise was the biggest daily jump in 17 years. Prices have dropped by at least 20p per litre since the high point.