Yesterday, there was bad news aplenty on the high street. Fast fashion retailer Peacocks hovered precariously on the brink of pre-pack administration with a £240m debt burden. Shoe business Barratts/Priceless received a life-saving cash injection from Michael Ziff, only narrowly escaping bankruptcy. HMV was hanging on by a thread. And today, electricals retailer Dixons reported a 5% drop in like-for-like sales over Christmas despite being the ‘last man standing’, a title coined by Seymour Pierce analyst Freddie George.
But apparently, at least one high street is about to see a sales surge that will turn its fortunes right around: Oxford Street is getting a brand new cash cow this year.
A report from the New West End Company (the area's Business Improvement District), released yesterday afternoon, predicts a 3.5% rise in sales across London’s biggest shopping district. Millions of international visitors flying over to watch the Olympics will take time out from Canoe Slalom and Taekwondo to hit the West End, it says, bringing the spend up to £7.7bn over the next 12 months.
London’s West End has always been more resistant to recession than other high streets in the UK. Last year, while the national sales figures showed just 0.1% growth for the year, the West End grew 3.1%. But with the forthcoming Olympics, coupled with the Queen’s Diamond Jubilee, the area will see an even greater influx of shoppers seeking luxury goods on Bond Street, Oxford Street and Regent Street. These visitors will account for a third of customers, says the report. Retailers, take heed: it might be time to brighten up your West End outlets in anticipation for the shopping stampede.
Foreign money and home-made designer togs and accessories have proven a recession-thrashing mix for UK firms. Just ask Burberry, which has posted 21% rise in fourth-quarter sales – mostly through demand in China. Growth in Asia may have begun to slow, but the appetite for luxury items has yet to lose pace. And with the UK expecting significantly more than the 150,000 Chinese visitors it received in 2011, our friends from the east could be spending much of this cash on British soil.
Maybe some of it may even fertilise regions beyond London's West End...