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The West End is preparing for its best Christmas since before the pandemic with spending expected to be sharply up on last year as the cost of living crisis that has blighted the high street finally recedes.
New forecasts published today show that less cash strapped domestic consumers are likely to spend around 7% more than last year in central London shops during the key “golden quarter” run up to the Big Day, which also includes the Black Friday discount bonanza in November.
They will inject an extra £224.9 million into the West End economy compared with Christmas, according to projections from retail analysts Rendle Intelligence.
It is likely to be the first festive season not overshadowed by the pandemic, which blighted the Christmases of 2020 and 2021, or the energy and cost of living crises, which squeezed shoppers spending power in 2022 and 2023. Rail strikes also added to the misery
But this year inflation has dropped back to just above 2%, real wages have risen, energy bills have fallen back and mortgage rates are on the decline.
Diane Wehrle, CEO of Rendle Intelligence, said “The forecast increase in domestic spending of 7% suggests that retailers have cause for optimism in what is recognised as the key trading period of the year. The forecast annual increase in domestic spending of 7% follows on from a more modest annual uplift of just 4% over the same three months in 2023, when inflation was much higher and interest rates had increased throughout the year.”
However she warned that disruptive planned engineering work that will affect services in and out of major stations including Paddington, Euston and Kings Cross during December “could act as a deterrent for shoppers coming into Central London over this critical trading period.”
Rendle Intelligence are expecting the upsurge in spending to gather pace during the three month Christmas build up with a 5% year on year increase in October, 6% in November and 8% in December.
The upbeat projections were reinforced by the annual forecast for Christmas spending from business group New West End Company (NWEC) published yesterday. These showed higher spending and footfall, with foreign tourists in particular contributing to the upsurge. The spend is expected to reach £1.7 billion in November and December.
NWEC’s boss Dee Corsi said: “The festive season is one of the busiest and most exciting times of year for the West End, and we are looking forward to welcoming both international and domestic visitors.
“In the last twelve months, we’ve seen a great deal of momentum in the district, with new brands such as Moco Museum, Diptyque and Future Stores opening their doors. What unites newcomers to the West End is their focus on delivering immersive, and increasingly leisure experiences – something we know that consumers will travel further afield to enjoy.
“To amplify what we expect to be strong trading period, on December 7, in partnership with Great Ormond Street Hospital Charity, we are transforming Oxford Street into a vibrant hub of festive activity with our Big Day of Joy, featuring special on-street performances and in-store activations.
“Despite a dip in consumer confidence pre-Budget, we expect that the West End will see growth in terms of both sales and footfall this winter.”
The Christmas shopping season officially kicks off in the West End on November 5 when the traditional lights are switched on along the 1.2 miles of Oxford Street. However, some stores have been in the Christmas spirit for several weeks already with the John Lewis Christmas shop opening on 25 September. Bosses at the department store group say shoppers have been stocking up early with sales of individual baubles up 130% and wrapping paper up 87%.
Covent Garden traders are also gearing up for what they expect to be a strong Christmas season. The decorations in the piazza will go up on 12th November.
More than 40 huge bells with bows, 12 giant baubles and 8 spinning mirror balls, weighing almost 8.5 tonnes on displayed in the Market Building while a 60ft Christmas tree will be decorated with more than 30,000 LED lights
Carnaby Street has also unveiled a new design led Christmas light installation to the famous Soho destination.
Fraser McKevitt, head of retail and consumer insight at retail analysts Kantar, said that while many families were still struggling after the inflation explosion of the last two years, a reduction in the rate of food inflation from 17% to less than 2% meant they had more money in their pockets to spend.
He said: “I would say the prospect is one of cautious optimism. The horror of the price rises of the past few years has faded a bit, but it has been a tough couple of years. It’s Christmas, people will want to celebrate after being clobbered for a long time.”
Adam Hug, leader of Westminster City Council, said:
“Across the West End, the buzz is back after the lean years of lockdown. As that shadow lifts, we have seen a steady conveyor belt of big-name retailers taking up space along with restaurants, restaurants and art galleries.
“Footfall is up across our famous shopping areas and Oxford Street is on a roll as the council encourages individual pop-up businesses and niche traders, and at the same time uses continual enforcement action to make life harder for some of the unscrupulous traders behind the candy store and souvenir shop epidemic.
“The analysis is clear that London is retaining its crown as a leading global attraction with people flying in to enjoy what the wider West End has to offer. A varied range of retail, theatreland, beautiful buildings and unbeatable nightlife – it all adds up to a Christmas cracker of a proposition.
“The council will keep doing all it can to ensure our high streets across the city enjoy the sound of jingle tills, and these retail estimates are indeed welcome early festive cheer.”
