Retailers are bracing for a calmer Boxing Day this year despite the lack of pandemic restrictions as the cost of living crisis weighs on shoppers’ budgets.
Spending is expected to reach nearly £3.8bn on December 26, according to research by GlobalData for Vouchercodes.
That’s down nearly 4% from a year ago, which was already difficult for retailers due to fears of the Omicron variant of Covid-19, which deterred some people from hitting the high street. and led to restrictions on store openings in some areas.
This turnover indicates a sharp drop in the volume of items purchased, given that inflation is over 10%, so shoppers will spend more per purchase. More than a third of this year’s bargain hunting is expected to take place online, where £1.25billion will be spent.
The fact that several major chains – including Aldi, Iceland, John Lewis, Pets at Home, Poundland and Beaverbrooks – will be closed on Boxing Day adds to the damper of the traditional post-Christmas shopping spree. Many are carrying on a tradition started during the pandemic, and in some cases even earlier, of rewarding hard-working staff with a day off after the holiday shopping season.
Richard Walker, Managing Director of Iceland Foods, said: “This year has taken a toll on everyone, so officially closing our doors on Boxing Day is just a small token of appreciation to our employees.
“As we enter the winter months, the cost of living burden will unfortunately only increase, and as we work tirelessly to pass on savings and support to our customers, we must also take care of our teams who are at the forefront of this crisis every day across the UK.
The expected decline in Boxing Day trade from a year ago continues a long decline in popularity of the annual shopping tradition, as the rise of the US-inspired November Discount Day and move towards the start of the year-end sales before Christmas Day combined to steal his thunder.
This year a total of £1.08billion is expected to be spent online on Christmas Day, for example, when not so long ago hardly anything was bought as shops were closed, although this also represents a 4% decline from 2021.
As Christmas Day falls on a Sunday this year, there will be an additional public holiday when the shops are open – Tuesday 27 December – which means bargain hunting can be spread over several days, further diluting the significance of December 26 receipts.
“The combination of Black Friday and the large amount of discounts we’ve had across the industry drove a lot of those potential Boxing Day sales forward,” said Richard Lim, an analyst at Retail Economics.
However, Lim added that for those looking for bargains, retailers were likely to offer deep discounts in a bid to clear inventory that was ordered earlier in the year when “conditions looked much rosier”. .
“Boxing Day and January [price cuts] will be deeper and much more widespread than normal because retailers will be desperate to stash cash inventory and shore up their balance sheets as we enter a recessionary predicament in 2023.”
He suggested there was a chance stores could be busier than expected due to a combination of deep discounts and pent-up demand caused by the mix of strikes and snow before Christmas.
However, the expected difficult start to post-Christmas sales will put further pressure on retailers who are already suffering from a lackluster winter hit by transport and postal strikes, snow and soaring energy and food bills which have limited cash available for spending on gifts and treats. .