The retail and leisure sectors will enjoy a spending boost during the World Cup, according to the latest market research.
Verdict Research is expecting total retail expenditure to rise by £1.3bn throughout the tournament as consumers buy more sportswear, merchandise, flat-screen TVs and food and alcohol. If England is successful in the tournament then the boost will be even more pronounced, predict the market analysis firm.
The spending spike would represent a 5.8% rise in total expenditure during the tournament, which culminates in the 11 July final in Johannesburg.
Phil Duffy, partner at corporate restructuring and insolvency experts MCR, says: “While the growth of sales partly depends on how long the English team remains in the competition, the World Cup will have a noticeable effect on the retail and leisure sectors.
“Sales in bars and pubs will rocket while the games are on, and supermarkets will benefit from increased spending on groceries and alcohol by those watching at home. However retailers need to be wary of having too much of certain stock in the event that the English team does not get through to the next rounds.”According to the British Retail Consortium, a beleaguered retail sector has already enjoyed a rise in sales of clothing and DIY goods thanks to warm weather and retail promotions in May. Sales increased by 0.8% last month when compared to April’s results.
Duffy believes the good news is a vital boon for a sector braced for a rise in VAT in the forthcoming emergency budget.
“This year we experienced economic uncertainty due to the election in May, making consumers cut back on spending in April,” he explains. “Improvements in sales this summer, however minor, are hopeful.
“While it remains a difficult time for the retail sector as a whole, there have been fewer casualties in 2010 as the weakest businesses have already collapsed.
“The industry may not entirely be out of danger, but given its previous struggle to emerge from the recession, the figures indicate a positive step forward for the retail sector. While the World Cup only lasts a matter of weeks, the industry will certainly benefit from it. We can look forward to its contribution to the growth and prosperity of the sector.”
