Christmas – will Retail be celebrating?
Ratner felt you have to take pre and post Christmas performance together. Reminding us of last year, when we had the week run up to the Christmas on a Sunday. As he says, “This year, Christmas day is on a Monday so you don’t have that full week run up ahead of it. Therefore there could be some disappointment.” Equally, last year Christmas went well on good last minute sales and people did better than the previous year before Christmas.
However, figures fell off rapidly within a week of the sales starting; much more quickly then anyone had expected. The other issue is not just what sales are but what margin sales are and whether we are going to see as we’ve seen in the last couple of years a fair bit of discounting ahead of Christmas. Whether retailers hold their nerve and go for full margin sales or whether they panic if it doesn’t look like its going to be good. Usually, one goes and the rest seem to go, and only good old John Lewis and to some extent M&S tend to hold their nerve.
Thomas pointed out over the last 6 years, only once had John Lewis failed to achieve new record sales. “We’ll be expecting record sales again. Last Christmas we put on a big increase, achieving an 8% uplift actually in our peak week from the previous year and achieved new record sales.” And they’re expecting to do better then that this time around.
Thomas doesn’t see the climate as being so different from previous ones to cause any of us great concern that they’re not going to get there. He warned that if you’re way out of touch with last year’s figures at the moment and you’re already in difficulty, then your product isn’t right for the market you’re trying to cater for - and Christmas isn’t going to bail you out.
Richard Jones indicated that underlying trends suggest that there is growth in Retail sales, that should be maintained through Christmas. But with more interest rate rises looking likely in 2007, consumer spend next year is less predictable. Hyman agreed that possible interest rate rises shouldn’t affect Christmas, but could have an impact on consumer sentiment in the New Year.
“Interest rates shouldn’t affect Christmas, but could have an impact on consumer sentiment into next year.”
Richard Hyman
