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Shops braced for tough Christmas as cautious consumers turn to Net
Sri Carmichael, Consumer Affairs Reporter28.10.09
The high street is set for one of its toughest Christmases as consumers rein in spending and desert shops for online bargains, research for the Evening Standard reveals today.
With Britain in the longest recession on record, shoppers have taken to “cautious consumption”.
A ukNOW poll carried out by Hall & Partners for the Standard found one in three Londoners said they would spend less on presents, food and socialising this Christmas. Just under half planned to spend the same amount as last year, and only one in five expected to splash out more.
However, despite the Royal Mail strike threatening to delay deliveries, 40 per cent of people planned to do more of their shopping online, using price comparison websites to find cheap deals.
Only 19 per cent said they would use a credit card this year, and only one in 25 planned to extend their overdraft.
The reluctance to spend has led retailers to resort to desperate measures, with their festive season starting earlier than ever. Selfridges' Christmas shop opened at the start of August, Lidl has unveiled its “Christmas market” and Lewisham shopping centre is putting up its festive lights.
At Westfield shopping centre, Santa arrived before the Halloween ghouls. Nearly half of those surveyed in the ukNOW poll from Hall & Partners said they would start buying early for Christmas to give themselves time to search around for the best deals.
Jonathan de Mello, director of retail at credit information company Experian, said small businesses and independent retailers were likely to be the biggest casualties of the spending drought, with many closing. He added: “Christmas is likely to be very difficult. Things are certain to get worse before they get better.”
Stephen Alambritis, spokesman for the Federation of Small Businesses, called for the congestion charge and council parking restrictions to be suspended for the week before Christmas.
He said: “Many businesses in London rely on the Christmas trade for around 20 or 30 per cent of their annual turnover. It will be important for local authorities and the Government to help wherever possible.”
David Smith, director of operations at e-retail group IMRG, said people were “embracing” the internet as it was easier to compare prices. He said: “Sales are up 14 per cent on last year.”
He added that online retailers were making sure customers knew they were using alternative delivery companies to beat the postal strike.
Jace Tyrell, spokesman for the New West End Company, which represents traders in Oxford Street, Regent Street and Bond Street, said the tourist trade would protect retailers in central London: “The weak pound means people are coming to London to do their Christmas shopping.”
An extra £1 million is being spent on the Oxford Street Christmas lights this year. They will be turned on next Tuesday in tandem with those in Regent Street and St Paul's. The poll questioned just over 500 people between 16 and 65 for the Standard.
A third said they had been saving up for Christmas, with that rising to 40 per cent for men under 35. Fiftysix per cent of people said they were determined to spend within their means.
Despite the Christmas caution, Hall & Partners' worldwide chief executive Vanella Jackson said: “People are slowly becoming more optimistic about the state of the economy.”
Reader views (4)
Nowdays virtualy everything I buy is researched first on the internet. Gone are the days when I would visit a showroom for a TV/Washing Machine/Car because the shops either dont stock the "Which Best Buy" or they can't match the price. And if I want a kettle, thanks ASDA you made my morning coffee in your £6 kettle, the only exception is clothes, my wife has "touchy-feey" syndrome and where better to start than M&S. As a Pensioner on reduced interest rate invstments any savings are reasearched first, and it is amazing what you find, I would have never have known about IRISH PREMIUM BONDS, called "Prize Bonds" one of my better invesments, OK, I havent won anything but who cares, if cash them in I get 30% more pounds back and I could win 75 Euros+ every week, my other source of spending money a £25 win on Premium Bonds is a joke, this pathetic figure only pays for 15 minutes of a mechanics time in a main dealer.
- Pensioner Jim., The Lake District
While I appreciate that everyone has different approaches and attitudes towards the festive season, and we have different levels of disposable income, I could not help but chuckle and raise an envious eyebrow at Mr Kypre's situation last year, labelling a total Christmas spend of £250 as "shocking" and "out of control". My wife will require that much on Friday as this month's installment. The last time £250 was a "shocking" seasonal spend, Merry Christmas Everybody hit number for the 1st time.
- Jard, London
Steve, the price hike may have something to do with the amount business rates are being increased by Central Government. Unprecedented above inflation rates are being roled out by Whitehall and all of this will be passed on to the unsuspecting public.
- Dannyp, Egham
Don't believe it.
I Bought a pair of jeans in a well known store in Oxford Street on Saturday and was taken aback by the £75 price tag.That's a huge hike from £60 I paid for the same six months ago.They're obviously not suffering.As I walked out I felt like a victim of a mugging.
- Steve, London
