What a difference a year makes. This week marks the 12-month anniversary of one of fashion retail’s darkest days in recent times.
The riots that broke out across the country last August destroyed many retail businesses and highlighted a side to the UK populous that had been bubbling under the surface for some time. It remains no less of a concern today as youth unemployment is rising and many groups within society continue to feel disenfranchised from the government of the country they live in.
Issues like this, while exacerbated by a shrinking economy, are much more long-standing culturally and may take generations to fundamentally improve, but a year on there are some positives to draw on. We’ve taken a look in this issue at some of the business people who were affected by the riots and it is heartening to see how many of them have come back fighting thanks to support from customers and their local communities. It is this national spirit that has also seen the UK generally on something of a high this week, a year on, thanks to the supreme efforts of Team GB at the London Olympics. While retailers have had a mixed experience during the Olympics, with many telling us footfall has been significantly down, the improvement the Games have brought to the mood of the UK public cannot be underestimated.
Recessions are in most cases self-fulfilling prophecies. Defined officially as being two consecutive quarters of negative growth within the UK economy, by the time they are pronounced, they are usually over … but the headlines surrounding their announcement can send consumers into a panic that sees further contraction of the economy as they stop spending – and a vicious circle develops. Only this week, Mervyn King came under further pressure to cut interest rates again after revising his estimates to suggest the economy in the UK was not in growth over the past three months, as had been hoped.
This would usually spark another round of headlines and further concern among consumers, but it has been knocked off the front pages by our Olympic success, and it will be very interesting to see if this national positivity can actually have a far greater impact in combatting the tough economic picture than a further interest cut might.
Predictions are there will be a wave of spending in the coming fortnight as those who have sat glued to their TVs get out to the shops again. Not only is sportswear sure to get a huge shot in the arm from the thousands taking up sport as a result of the Olympics, but hopefully the national mood of celebration will also help with consumer confidence overall. The poor weather in June and July has left most retailers feeling the pinch, so this outpouring of national pride could not have come at a better time.