Clothing and footwear retailers in London’s West End have spoken of “challenging” trading conditions as the strong pound takes its toll on footfall and sales in the area.
Retailers have noticed a drop in tourists from regions including Europe, the Middle East and Russia. The latest Office for National Statistics figures show the UK’s earnings from international visitors fell 7% to £6.7bn in the year to April 2015.
Daniel Rubin, founder and executive chairman of footwear chain Dune, said footfall had dropped across the chain’s West End stores. “I put it down to fewer tourists. The Russians aren’t coming, there’s less from the Middle East and the number from Europe is lower. It’s more difficult after a strong year last year. Trade is down.”
One chief executive of a footwear retailer with stores in the West End described recent trade in its Oxford Street store as “quite tough”, adding: “Once you get out of London, trade gets better. It’s got to have something to do with the euro.”
Similarly, another retail source said her Oxford Street business was “slightly out of sync” with other locations. She said staff had noted a reduction in overseas tourists.
She also said disruption from the Crossrail construction work could be having an impact on footfall: “It’s hell in town with all the roadworks, which isn’t helping; it isn’t a nice environment.”
A managing director of a young fashion brand stocked in Topshop said he believed retailers in the middle of Oxford Street were affected by Primark being based at both ends, as well as the effect of Crossrail, adding that the area had “lost its gloss”.
Jaeger chief executive Colin Henry said trade in the West End was “soft at the moment” because of the exchange rate but was confident its Sale, which kicked off on June 16, would attract customers.
David Moss, owner of premium menswear independent Richard Gelding on North Audley Street in Mayfair, said: “There doesn’t appear to be the level of overseas visitors compared to previous years… obviously the Russians are not coming and there’s a shortfall down to the strength of the pound, dissuading people from coming to the UK.”
However, Reiss retail director Tracy Dixon said the premium retailer was enjoying double-digit growth in its West End stores and John Lewis Oxford Street concessions: “I get exposure to how some other brands are doing and we seem to be bucking the trend.”
Footfall to the West End fell 4.6% during the week commencing June 8, according to data compiled by research firm Springboard and the New West End Company, which represents retailers in the area. In Greater London, footfall fell 3.2%.
John Lewis reported a 6.3% slip in sales in its Oxford Street store for the week ending June 6. This was in contrast to John Lewis’ overall sales, which enjoyed a 4.1% rise, although this was helped by its web sales surging 21% year on year.
Jace Tyrrell, deputy chief executive of the NWEC, said footfall to the West End grew 1.6% year on year in May, compared to a 1.8% drop nationally. He added: “We are predicting a boost in sales post-Ramadan with a rise in the number of visitors expected to come and enjoy the unique offering from these iconic streets.”
UK retailers are gearing up to capitalise on the spending power of Middle Eastern and Muslim shoppers ahead of Ramadan, which begins on June 18. Selfridges has extended its opening hours in the run-up to and during the period, while Westfield London has hired two additional Arabic speaking concierges.