Across the country, retailers are gearing up for the biggest event in the industry calendar. Although Christmas sales have proven sluggish in recent years as consumers tightened their belts, now that the recession is officially over many hope that this year will prove merrier for their businesses.
Queen Victoria shops, The Royal Arcade, London
Fortunately, these hopes could well be founded should recent research prove to be true. According to market research specialist Verdict, consumers will spend a total of £88.4 billion in the final quarter of 2013, with spending split between commercial properties and online retailers.
This equates to a 2.2 per cent increase on spending in the run up to Christmas last year – the strongest rise in forecast spending since the start of the recession in 2008.
Verdict believes that many factors contribute to this predicted boom in spending, including improvements in the housing market and an overall uplift in consumer mood. This is why, for the first time in nine years, an increase in spending could very well occur in all sectors of retail.
Analyst at Verdict, Maureen Hinton, says; “Consumer confidence drives spending and consumers have more reasons to be cheerful this year.
“Economics news is positive, the housing market is moving and there are more initiatives to buy which makes people feel better off – so they invest in doing their houses up or move at last and spend on big ticket items.
“There are also more young kids around because of the higher birth rate – and they are drivers of spending for parents and close family.”
Verdict expects that around 13.2 per cent, or £11.6 billion, of the total spending this year will take place via the internet or using mobile apps, mainly due to the wealth of “click and collect” services now commonly offered by high street stores. Should this come to pass, this will mark a year on year increase of 12 per cent in the internet shopping sector, making the internet the largest growth driver in the retail industry.
Furthermore, supermarkets are expected to rake in the profits with consumers seeking to spend lavishly on food and non-food items. Verdict predicts that £36.4 billion will pass through the tills of supermarkets, although those who have not yet adapted their technology to cater for internet shoppers such as Morrisons will quite possibly lose out on the lucrative spend.
Should the predictions made by Verdict translate into rising sales for the nation’s retailers, there is a very real chance that this Christmas could truly kick-start the recovery process which has so far been somewhat sluggish within the retail industry. This would allow many to look at expansion and growth for the coming year, lending strength to businesses beaten down by four long years of recession.
Do you think spending will increase as much as Verdict forecasts, or will consumers remain cautious and save the bulk of their spending for the January sales?
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