Grainne Gilmore, Economics Correspondent
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Chilly weather this weekend will spell gloom for retailers as shoppers stay
indoors, an economic consultancy said yesterday.
Britons are expected to spend £9.1 billion on goods and entertainment over the
Easter weekend, some 14 per cent less than last year, when they splashed out
£10.6 billion, the Centre for Economics and Business Research (CEBR) said.
Garden centres and DIY stores will be particularly hard hit. For retailers,
Easter is the most important sales period after Christmas.
The CEBR said: “The combination of bad economic news and bad weather is
unlikely to be the best background for spending.”
This week the British Retail Consortium (BRC) forecast that sales in the eight
days of Easter would be £8 billion – 3 per cent higher than last year. It
said that £4.4 billion would be spent in the four days leading up to Easter
and a further £3.6 billion over the long weekend. But it, too, gave warning
that DIY and gardening sales could fall.
The CEBR said that DIY stores and garden centres in some areas could see sales
fall by 50 per cent compared with last year as shoppers stayed at home and
fewer home sellers spruced up their houses to impress viewers.
Easter is usually a bumper weekend for the housing market, sparking the start
of the spring sales season. But forecasts for icy winds and snow are likely
to deter all but the most determined househunters.
This is particularly depressing news for big DIY stores such as B&Q as
Easter is their most significant sales period. A spokesman for the BRC said: “Easter
is a more important sales season than Christmas for DIY and garden stores,
so the combination of the early Easter, terrible weather and the increased
pressure on customers’ budgets at the moment is leading to heavy discounts
in stores. The fact that we have an early Easter was always going to be
difficult.”
Easter is earlier this year than in any other year since 1913 and it will not
fall this early again until 2160.
The CEBR said that spending was “exceptionally strong” last year as parts of
the UK enjoyed higher temperatures than the Costa del Sol but that, even
when compared with a normal Easter, spending this year is forecast to be
“depressed”.
Spending on food is expected to hold up or even increase slightly as shoppers
stock up on comfort food. Sales of winter dishes such as casseroles,
shepherd’s pie and bangers and mash have all risen over the past two days,
according to Tesco, the UK’s biggest supermarket.
Tesco stores have also reported a 25 per cent rise in pudding sales as Britons
turn to traditional hot desserts to cope with the grim holiday conditions.
Sales of whisky have also shot up, by 39 per cent.
Consumers are set to spend £280 million on Easter eggs, the BRC said, although
sales of the chocolate treats have been more modest this year than in the
past.
Sales increased by only 9 per cent in the first two weeks of the six-week
run-up to Easter, down from a 16 per cent rise last year and a 17 per cent
rise in 2006.
Increasing numbers of shoppers are choosing instead to buy other chocolate
novelties, such as bunnies and flowers. However, hot cross buns are still a
firm favourite. Sales of the seasonal snack rose by 10 per cent in the first
two weeks of the Easter period, the same as two years ago. Families are set
to spend £20 million on them.
Retailers hoping for a boost from last-minute errands may be disappointed.
Mike Watkins, of the BRC, said: “It is possible that any last-minute rush to
buy food and indulgences will be less marked than last year when the weather
was unseasonably warm.”
But there was a glimmer of hope. “The silver lining in the cloud for retailers
is that some of the spending that does not happen this weekend may reemerge
later in the spring when the weather warms up a bit,” the CEBR said.
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