It was months ago that many economists predicted that Christmas in the UK would prove to be a source of smiles for high street retailers all around. Part of their initial optimism was based on the fact that, given the extremely cold weather that embraced the UK earlier than usual autumn, many consumers rushed out to get the appropriate winter clothing. Many pundits figured that this signaled a renewed interest on the part of consumers to open their wallets November came and went, it appeared obvious that things were not looking so rosy after all.
Making Valid Comparisons
The Office of National Statistics keeps track of these sorts of things. While there was somewhat of a surge in shopping back in October, perhaps a more valid comparison is to see what happened for the three months leading to November, that is to say August through October and compare them to the previous three months, which would be May through July. Using that as a measuring stick, sales were basically unchanged from one three-month period to the next. Many retailing experts have also noticed that the last few years, shoppers have typically waited until late into the month of December to make their purchases, hoping to capitalise on special bargains and sales provided by retailers.
The Rising Trend towards Online Sales
There is no doubt that e-commerce is a phenomena which is not going to abate anytime soon. In fact, most experts believe that it will continue to take a significant portion of market share away from the high street. Sure enough, the latest ONS figures show that e-commerce rose a full 1.4 percentage points, accounting for almost 12% of all retail sales, the highest percentage to date. The larger high street merchants have figured out that they can’t possibly beat online commerce, so they have wisely decided to add this electronic component to their overall retail mix.
The Problem with Household Budgets
It is also true that unfortunately, household budgets have been thrown into somewhat of a quandary. Inflation is rising faster than real wages, which means that most households don’t have as much disposable income available. Retailers, as well as economists in general, are hoping will bring better economic news to the UK financial world. As an example, if the EU begins to shake itself awake from its overall economic lethargy, it would once again create an excellent source of exports for the UK manufacturing sector. Whether this can really happen is anybody’s guess.
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