UK shoppers to spend more but buy less this Christmas
Retail analyst Verdict Research is predicting tough times for UK retailers as the current financial crisis will impact Christmas shoppers on the high street. According to the analyst, consumers will have to spend more over the festive season due to the higher cost of food, resulting in less purchasing power for non-food items.
Retail analyst Verdict Research is predicting tough times for UK retailers as the current financial crisis will impact Christmas shoppers on the high street. According to the analyst, consumers will have to spend more over the festive season due to the higher cost of food, resulting in less purchasing power for non-food items.
Verdict forecasts that UK consumers will spend £82.3bn with retailers in the final quarter of 2008, approximately £1,363 per head. The analyst says this is the second lowest growth rate in 20 years, despite increasing by 2% on 2007’s figures.
“Not surprisingly food and grocery accounts for the largest share of shoppers spending over the Christmas period (38%) and with food inflation running at 6.3% this quarter, consumers are facing a more expensive Christmas feast,” says Maureen Hinton, lead analyst, Verdict Research. “Unavoidable though this extra expense will be, shoppers will be more careful in what they buy, balancing spending on treats with cutbacks on everyday foods.”
There is a glimmer of hope for the cosmetics sector however. Verdict predicts sales of health and beauty products to increase by 3.7%, despite inflation. Both men and women are still spending and as a nation, the UK spends more per head than any other European country.