Footfall at Scottish stores suffered the biggest drop of all areas of the UK in November, according to the Experian Retail FootFall Index, slumping by 5 per cent on the same month last year.

The figure was significantly lower than the average UK fall of 0.9 per cent. The report comes just days after the CBI revealed that UK high street sales had plunged at a record rate in October, while retail bellwether John Lewis also announced that like-for-like sales were down for the ninth week in a row at its 27 department stores.

It said yesterday sales for the past week had fallen 13 per cent on the same period last year.

Fiona Moriarty, director of the Scottish Retail Consortium, said: "Up until fairly recently, Scottish shoppers' confidence has remained higher than customers in other parts of the UK. However, the
… credit crunch was brought home for Scottish consumers in October and November, with what happened at Royal Bank of Scotland and HBOS.

"It made people realise that this was not just a global problem; that it was on their own doorsteps. That could be part of the reason why the figures are so much worse in Scotland."

Of the ten UK regions surveyed by Experian, only two reported growth – but Scotland's decline was by far the worst.

The North East of England and Yorkshire both increased shopper visits slightly – while only the eastern region's performance was close to Scotland, with a 2.5 per cent drop.

The survey also found that, UK-wide, retail business failures rose 18 per cent in November, on the same month in 2007 – including major companies Woolworths and MFI. Some 1,017 retailers collapsed in the 12 months to 30 November. The number of food stores that failed rose by almost 9 per cent, taking the total number of failed food retailers in the year to 173.

Jonathan De Mello, director of retail consultancy at Experian, said: "It seems efforts at deep discounting have failed to attract significant shopper numbers into stores. The spectacular events held at the end of the month provided some spikes in shopper numbers, but levels have quickly dropped back and, overall, shopper numbers are down on last November. Deep discounting by retailers may have also brought forward shoppers from December into November and set back the traditional Christmas rush."

The report also revealed UK internet searches for discount vouchers have increased by 133 per cent over the past 12 months as consumers hunt for bargains.

Matthew Sherwood, senior economist at Experian, added: "This downturn has much further to run. UK consumers will be watching their pennies closely and, thus, there is little relief in sight."

The figures are reported on the day the government is set to reduce the rate of VAT to 15 per cent to kick-start the economy.

Sherwood added: "With punters staying out of the shops, many retailers are likely to hold on to the tax cut. If costs continue to fall, then this may be enough to avoid too many more Woolworths and MFIs."