Sales frenzy cannot be sustained
I remember this time last year. Some things never change – the post-Christmas party regrets, the turkey-enhanced bulging waistline, and the soon-to-be-ignored new year’s resolutions (mainly to do with the waistline and the party antics).
But some things do change. On December 31, 2007, the credit crunch was a vaguely amusing term, of interest only to economics geeks and the particularly foresightful. Now it’s a rampaging monster, doing for the global economy what Godzilla did for downtown Tokyo.
So it’s a bit of a surprise, to say the least, to see the Bullring announce a record set of results during what’s supposed to be the biggest financial catastrophe in 70 years.
Or not so surprising, perhaps, to anyone who’s seen the kind of sales going on at the moment.
When I emerged from the Christmas funk and dragged myself down to the city centre to go hog wild at the shops – like a wheezing West Midlands version of Sex and the City – I found nary a single item that wasn’t 50 per cent off, 70 per cent off, two for one or buy three, pay for two. And then the little VAT rebate like the cherry on the icing when you go to the till. And it’s been like this since before Christmas.
Remember January sales? They’ve slipped back a month this year as the retailers try desperately to bring the people in.
One of the biggest worries of the business world, back when we all had the economic luxury of being able to get worried about such things, was how to be sustainable. It was about managing the environment in a sustainable way then, but now shops need to look for a sustainable business plan.
After being castigated for spending too much on easy credit, consumers are confused at being ordered to spend, spend, spend to help out the ailing economy. Eventually shoppers will tire of the flashing lights and marked-down gewgaws of the January sales, and where will that leave the sector?
Company doctor Bryan Jackson, who is looking for a buyer for the Birmingham branch of collapsed fashion retailer USC, says he expects more chains to join the likes of USC, MFI, Zavvi, Adams, Woolworths et al.
And what a diverse bunch of retailers they are too.
It’s too easy as a business-owner to bury your head in the sand and blame the collapsed chains for failing to understand their customer base, or selling the wrong kind of products. Retailers need to look beyond the sales and start thinking hard about how they’re going to cope in 2009.
