Christmas 09 isn’t cancelled says BDO

Date 27 November 2009 Subject Christmas 09 isn’t cancelled says BDO Christmas 09 isn’t cancelled says BDO This Christmas will be better for the High Street than last year – and the spending spree will really kick-in on Christmas Day itself say BDO, the accountants and business advisers. A rush to snap up online bargains on Christmas Day will start a week of frenzied shopping in the sales that will take overall spending to three per cent ahead of last year. Canny shoppers will take advantage of sales combined with the lower VAT rate – due to rise on 1st Jan 2010 – to bag themselves bargains galore. The prediction comes from BDO’s High Street Sales Tracker developed by BDO, which has accurately forecast shopping trends since 2006 by monitoring weekly sale changes of more than 70 retailers with approximately 10,000 individual stores. Comments Don Williams, Head of Retail, at BDO LLP: “It’s going to be nerve-wracking for retailers in the run-up to 25th December, but the message is: Christmas will come, just be patient.” Online shopping on Christmas Day itself is a growing phenomenon. Visitor numbers to the John Lewis website on 25th December 2008 were a staggering 12 times higher than in 2007. With cash and vouchers likely to be popular present choices this year, families purchasing gifts together, combined with those eager to bag a bargain as soon as the sales start and before the imminent VAT rise, will compound momentum for this growing trend. BDO is predicting hefty discounting on big-ticket household items such as laptops and electrical goods will be particularly appealing to the Christmas Day Shopper. Don Williams continues: “Online sales are set to soar and should beat the 14 per cent growth we saw last December - especially now the postal strikes have been called off. Interestingly, the change in the country’s demographic - socially and ethnically - has also fuelled this trend. Our increasingly diverse multi- cultural society means the 25th December is no longer a day of religious significance for all. Sadly the growing rate of broken homes and those on their own at this time also makes online shopping an attractive alternative to the predictable repeats on TV. “However, the Christmas cheer could well fizzle out in the New Year. Once VAT rises back to 17.5 per cent on New Year’s Day sales will slow so retailers really need to make hay while the sun shines and maximise the Christmas spending spree.” - Ends – Note to editors The BDO Business Trends Report Indices are calculated by taking a weighted average of the results of all the UK’s main business surveys carried out during the last month. Methodological notes: The BDO Monthly Business Trends Indices are prepared on behalf of BDO LLP by the centre for economics and business research (cebr). Taken together the surveys cover over 11,000 different respondents from companies employing approximately five million employees. The respondents cover a range of different industries and a range of different business functions. Together they make up the most representative measure of business trends available. The surveys are weighted together by a three-stage process. First, the results of each individual survey are correlated against the relevant economic cycles for manufacturing and services. This determines the extent of the correlations between each set of survey results and the relevant timing relationships. Then the surveys are weighted together based on their scaling, on the extent of these correlations and the timing of their relationships with the relevant reference cycles. Finally, the weighted total is scaled into an index with 100 as the mean, the average of the past two cyclical peaks as 110 and the average of the past two cyclical troughs as 90. 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The combined fee income of all the BDO Member Firms was $5.14 billion in 2008. The global network has 1,095 offices in 110 countries and more than 44,000 partners and staff provide business advisory services throughout the world. BDO LLP and BDO - Belfast are both separately authorised and regulated by the Financial Services Authority to conduct investment business. BDO is the brand name for the BDO International network and for each of the BDO Member Firms. Contacts Laura Gainsford on behalf of BDO, or Laura Hegarty if out of office hours Debbie Osborne LCM Tel: 020 7260 2700 or if out of office hours: 07919 205301 Email: laura.gainsford@bluerubicon.com Tel : 0845 345 6969 Email : debbie@lcm.co.uk