Business
Economic uncertainty blamed for ‘lacklustre’ retail performance last month
Analysists have blamed rising economic uncertainty for a “lacklustre” July that saw Scottish retail sales fall in real terms compared with the same month last year.
According to figures from the Scottish Retail Consortium (SRC) and KPMG, total sales in Scotland rose 0.1% last month compared with July 2024, when they had decreased by 0.9%.
However when adjusted for inflation this represents a year-on-year fall of 0.5%.
Food sales in Scotland were down 1.4% compared with July 2024, when they had decreased by just 0.3%.
This was despite a strong opening to the month when hot weather led to a “boost” in spending on barbecues and summer meals.
Non-food sales on the other hand rose by 1.4% compared with the same period last year, with analysists saying phones and some furniture and toy ranges performed well.
Adjusted for the effects of online sales, non-food sales increased 1.6% on July 2024, when they had decreased by 1.5%.
Ewan MacDonald-Russell, deputy head of the SRC, said: “July was a lacklustre month for Scottish retailers as sales again disappointed.
“When adjusted for inflation retail sales in Scotland fell by 0.5%. That’s a slight improvement on June’s figures, but demonstrates shoppers continue to cut back on shopping as economic uncertainty continues to rise.
“Within the general disappointment there were some bright spots. Food sales shone in the opening half of the month as Scots took advantage of the warm weather to cook barbeque and summer meals.
“Phone sales did well, as did some toys and furniture ranges. Against that televisions continue to disappoint, with few households investing in high-end entertainment despite the summer plethora of sporting events.
“Fashion ranges performed poorly, albeit the likelihood is shoppers did their summer wardrobe shopping earlier in the year when the sunshine emerged.
“The harsh truth is Scots are holding back spending as worries about the economy grow.
“That is leaving shops in the lurch – facing higher costs as a consequence of last year’s UK Government budget without the growth needed to pay those bills.
“With little sight the economic weather will brighten, many retailers, especially those on the high street, face increasingly unpalatable choices in the coming months.”
Linda Ellett, UK head of consumer, retail and leisure at KPMG, described the current trading environment as “challenging” for retailers.
“The UK’s fifth warmest July on Met Office record brought a boost to home appliance and food and drink sales,” she said.
“But rising inflation was also a driver of the latter and monthly non-food sales are only growing at around 1% on average at present.
“With employment costs having risen and inflation both a business and consumer side pressure, it remains a challenging trading environment for many retailers.
“While the majority of consumers that KPMG surveys are confident in their ability to balance their monthly household budgets, big ticket purchases are more considered in the context of rising essential costs and ongoing caution about the economy and labour market.
“Holidays are the priority for many this summer but those heading away have had to account for a higher cost of travel.
“Consequently, spending in some areas of the retail sector remains subdued and competition for consumer spend will remain fierce.”
The figures were published in the SRC-KPMG Retail Sales Monitor for July.
All of the chain’s standalone stores have stopped trading in the UK and Ireland.
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A pedestrian walks by a Domino’s Pizza on Dec. 9, 2025 in San Francisco, California.
Justin Sullivan | Getty Images
Domino’s Pizza stock fell 10% in morning trading on Monday after it reported weaker-than-expected U.S. same-store sales growth.
The chain’s domestic same-store sales rose just 0.9%, lower than the 2.3% bump expected by Wall Street analysts, based on StreetAccount estimates.
“We’re not happy with it,” CEO Russell Weiner told CNBC.
The pizza chain also lowered its full-year U.S. same-store sales forecast to low-single digit growth, down from its prior projection that U.S. same-store sales will increase 3%.
Weiner said he expects more fast-food chains to report similar headwinds from winter weather and weak consumer sentiment, which took a dive in March due to spiking fuel prices caused by the U.S.-Israeli war with Iran.
“One of the bad things about reporting first is you don’t get to hear about anybody else,” Weiner said.
Domino’s kicked off the earnings season for restaurant chains. Starbucks is on deck after the bell on Tuesday, and Chipotle Mexican Grill and Pizza Hut owner Yum Brands are expected to share their results on Wednesday. Rival Papa John’s will report its earnings next Thursday.
During the quarter, Domino’s also faced stiffer competition from rival pizza chains. Papa John’s and Pizza Hut both matched Domino’s $9.99 “Best Deal Ever” with promotions at the same price point. And Little Caesars undercut Domino’s $6.99 Mix & Match deal with a $5.99 version.
“People are seeing what we’re doing, and they’re sick of losing share, and they’re coming at it,” Weiner said, adding that he still expects Papa John’s and Pizza Hut to report same-store sales declines for the quarter despite the new promotions.
Looking ahead, Weiner expressed confidence that Domino’s will prove itself in the long run.
“Domino’s has got a bigger advertising budget than our second two competitors combined,” he said. “And those competitors are both going up for sale, so we know things aren’t good there right now.”
Yum announced in November that it was exploring strategic options for Pizza Hut, which could include a sale. And Papa John’s is reportedly in talks with Qatari-backed Irth Capital to go private. Both chains have also announced plans to close hundreds of restaurants this year, which could further boost Domino’s dominant position in the pizza category.
And if either Pizza Hut or Papa John’s goes private, Weiner said he expects that a new owner would shutter even more locations — a win for Domino’s.
Shares of Domino’s have lost nearly a third of their value over the last year. The company’s market cap has fallen to roughly $11.2 billion.
United Airlines CEO Scott Kirby (L) and American Airlines CEO Robert Isom listen as U.S. Transportation Secretary Sean Duffy speaks to reporters outside the White House on October 30, 2025 in Washington, D.C.
Kevin Dietsch | Getty Images
United Airlines CEO Scott Kirby confirmed Monday that he contacted American Airlines about a potential merger, a possibility American rejected.
“I approached American about exploring a combination because I thought we could do something incredible for customers together,” Kirby said in a statement. He said he shared his “big, bold vision” because he was confident it could win regulatory approval.
American rejected the idea and its CEO, Robert Isom, last week said such a merger would be bad for customers and “anticompetitive.”
Kirby had floated the idea to the Trump administration earlier this year, according to people familiar with the matter who weren’t authorized to discuss the private conversation, in hopes that the combination would mean a big global airline to compete with foreign rivals
American declined to comment on Kirby’s Monday statement.
“I was hoping to pitch that story to American, but they declined to engage and instead responded by publicly closing the door,” Kirby said in his statement Monday. “And without a willing partner, something this big simply can’t get done.”
He said that “American’s public comments make it clear that a merger like this is off the table for the foreseeable future” but outlined his vision for a combined airline.
Kirby reiterated that the country has deficit with foreign airlines that fly more than half of the long-haul seats into the U.S., with most of the customers being Americans.
“The combined scale of United and American would be a better way to compete with foreign carriers,” he said.
President Donald Trump said he was against the idea of a combination last week.
“I don’t like having them merge,” he told CNBC’s “Squawk Box” on Tuesday morning. He said he would, however, like someone to buy struggling discount carrier Spirit but he also suggested that the federal government could “help that one out.”
Spirit and the Trump administration are in advanced talks for a rescue package.
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