A new report from business advisory firm Deloitte, predicts that despite the economic position of many, retail spending in the UK will increase by 1% year on year this Christmas. Retail sales are expected to top £37 billion this December but 2011 is set to be a more difficult time as disposable income takes a hit.
20,000 consumers were surveyed across Europe, 2,000 in the UK where 71% reported that they plan to spend the same or more on Christmas gifts this year. 76% have a similar approach to their festive food and drink spending this year while an even bigger percentage (79%) intend to spend similar or more on their entertainment and leisure spending this Christmas.
2011 however looks a bleaker picture. The rise of VAT to 20% is expected to have an impact as will the rise for some in National Insurance, leaving less disposable income. A third of those surveyed expected their financial position to get worse next year, including the impact of the Government’s spending review.
According to Retail Week, the figures come from a survey that found that 71 per cent of respondents intended to spend more on gifts, while 79 per cent intended to spend more on entertainment and leisure.
“Each year, consumers tell us they will do whatever they can to enjoy Christmas and this year will be no different,” said Deloitte’s UK head of retail, Ian Geddes.
However, the rosy forecast is not expected to continue in to 2011, where Deloitte expects that the industry will not see any growth over the course of the year. This is reflected in the survey, which sees 38 per cent of respondents forecasting the economy to deteriorate.
Interestingly, other recent reports have suggested that online purchases continue to rise – perhaps as consumers look to make the best savings possible. So now might be the perfect time to be getting your own online shop up and running. Check out our ecommerce offerings or consider the eshop function with InstantSite Pro.
Are you cutting your personal spending this Christmas?