With a matter of days left before Christmas, small businesses that usually experience a busy December will already have an idea of how well they’ve fared this year. More than £16 billion is expected to be spent on Yuletide items in 2014, according to Webloyalty, be that presents, food and drink, or other seasonal items. Whether you’re a retailer, wholesaler, or in the hospitality and service industries, by this stage you probably know if you’ve won much of this prized pot this winter – or if you’ve been a loser in the race for the festive pound. So, which parts of Britain have been keen to spend the most this season? Where have consumers been keeping their hands in their pockets? And what have been the big shopping trends?
Santa comes to Scotland
The Scots are accustomed to cruel jibes from their southern neighbours, and one such hollow insult is that people in Scotland are reluctant to part with their money. But all evidence in the run-up to Christmas was to the contrary – Scots planned to spend the most of any of the UK regions on gifts this year, according to a poll by eBay, with small Scottish retail firms set to benefit into the bargain.
- Scottish shoppers were expecting to shell out an average of £268 on about 15 presents for 11 people this year.
- Those living in the South West were also of a generous nature, with a good number planning to buy between 20 and 30 gifts, and spending an average of £241 a head.
- The high cost of living in the capital seems to have made Londoners mean-spirited, with people in the city expecting to buy for just eight others, and spend £206 on average.
- North Yorkshire was another area of generosity, with an average spend of £508.82 expected, according to research by the BBC in the region, though this included food and drink, as well as presents.
- Those in Lincolnshire can expect a less lavish Christmas, with £433.16 spent on average on all festive costs, the BBC poll found.
The good news is that there are plenty of people planning to spend a proportion of their budget with smaller retailers. Social media users, in particular, have expressed a desire to support local enterprises, with almost nine out of ten Twitter users saying they intend to shop with small and medium-sized firms this Christmas, according to research by Millward Brown.
What’s under the tree?
Whether they live in Bradford, Birmingham, or Bath Spa, many people are opting to buy the same items this year, with a few choice products proving to be the must-have presents of the season.
- Technology and gadgets, such as the Xbox, iPad, and high-end Wi-Fi speaker systems, have been among the most popular purchases, according to eBay’s Christmas shop, so smaller shops and online retailers specialising in electrical goods should have seen a run on their stocks of these top items.
- Classic toys, including Lego and board games, are also likely to keep Britain’s children entertained on December 25, as they continue to fly off the shelves, as well as online games and consoles. Traditional toy shops may have experienced a good end to the year as a result. In particular, the Disney film Frozen has created a huge demand for dolls and other related merchandise among young girls, while boys are clamouring for the Nerf Cam ECS12 Blaster, a sophisticated toy gun that shoots foam darts.
- The must-have big boys’ toys of the year appear to be drones, small, amateur, remote-controlled devices that can fly and hover at the flick of a switch. It’s guessed about 30,000 will have sold in the UK by the end of the year, mostly from electrical retailers and online.
- Handbags remain a popular choice for women, eBay says, along with perfume and lingerie. Independent boutiques, and clothing retailers should have benefitted from the last minute dash for wives’ and girlfriends’ presents.
This week will have seen many food and drink retailers experience an upturn in trade, as people race to stock up before the gastronomic blow-out of the coming days. More than £5.2 billion will be spent on food and drink this festive season, Webloyalty predicts, much of it just ahead of Christmas day. But a lot of this money goes to the supermarkets, with only six per cent of people saying they will buy from retailers other than the big names – in other words, smaller independents. And small hospitality businesses also weren’t expecting the best holiday season this year. About a quarter of Britons planned to cut back on eating and drinking out in December to help cover Christmas costs, according to Greene King’s Leisure Spend Tracker, so pubs, restaurants, and bars may have had little to celebrate.
Sales boosts from special events
However, there have been some bonuses for retail firms this shopping season. A number of events occurred in rapid succession from late November to early December, all of them designed to fuel the consumer appetite for spending at this time of year. And these weren’t entirely big brand occasions – SMEs saw a welcome lift from the promotions, too.
- First up was Black Friday, a US-born sales day at the end of November that really took off in the UK this year, as we predicted here. It really kick-started Christmas sales, and gave a much-needed boost to many shops, according to the British Retail Consortium, particularly those selling electrical goods, and clothing. It was an online occasion, too – about £810 million was spent on the internet that day, according to retail analysts IMRG, with e-shoppers in Birmingham, Belfast, Glasgow, Sheffield, and Manchester being the biggest spenders, retail data expert Postcode Anywhere
- Next came Cyber Monday, the date designated for online retailers to exploit the bargain-buying action. It brought in an estimated £720 million for UK e-commerce, IMRG calculated, up a fifth on the year before. Again, smaller retailers got a look-in, since about one in three independent retailers now trades online, according to the British Independent Retail Association, getting about 12.5 per cent of their turnover via the internet.
- Finally, there was Small Business Saturday on December 6, early in the Christmas shopping period. This promotion was specifically targeted at smaller, local businesses, as we highlighted earlier this month. It brought in 16.5 million people into shops and small firms across Britain, with about £504 million worth of sales made. This was a £36 million increase on the 2013 version of the event.
So, this Christmas has seen both winners and losers in the small business community. But whatever your firm’s fate this festive season, the holiday means most of you can allow yourself a well-earned rest over the coming days. Make sure that you do so. And, until we speak again, Boost Capital would like to wish you a very happy Christmas!