Member Article

North East consumers "to make biggest cutbacks"

In contrast to national trends, North East consumers are set to make the biggest cutbacks in spending this Christmas with a predicted 25% decline on last year’s spending.

Nationally, UK consumers say they intend to spend the same this Christmas as they did last year, according to the annual Christmas Retail Survey, published by the business advisory firm Deloitte.

24% of respondents say they will spend less and 19% say they will spend more. In fact, for many people in the UK, this year will be Christmas as usual.

Paul Feechan, partner and head of consumer business for Deloitte in Newcastle, said: “This Christmas may be one of the toughest in decades and retailers have been toughing it out for most of the year. Although we think the talk of Christmas being cancelled is overplayed, it is clear that people in the North East are reining in their Christmas spending this year, whether it’s purchasing gifts, food and drink or socialising. Retailers will need to understand their consumers better than ever and offer relevant products to take a share of the Christmas wallet.”

In the North East people plan on spending an average of £628 on gifts, socialising and food and drink, while nationally consumers are planning to spend £655.

Another accountancy firm is bacing up the findings from Deloitte. Bill Macleod, head of assurance at PricewaterhouseCoopers LLP Newcastle, commented on how retailers will be tackling the prospect of a not very merry Christmas.

“Recent turmoil in the financial markets is making consumers even more jittery about parting with their cash,” he said. “Retailers will be chasing sales through considerable discounting. Online vouchers offering discounts of 20% or more will continue to land in people’s inboxes.

“Christmas always comes, it’s just later and later - this year the game of ‘sale chicken’ between customers and retailers in the run-up to Christmas will be especially nailbiting. The combination of terrible consumer confidence and retailers planning for the worst means that like-for-likes will be negative versus last year. I would not be surprised if some fascias disappear from the UK high street as further retail administrations occur.”

This was posted in Bdaily's Members' News section by Ruth Mitchell .