I think it's fair to say that the British Chamber of Commerce's (BCC) report on December's trading was about as icy as the weather. Together with the British Retail Consortium's (BRC) view that retail sales dropped 3.3% on like for like sales and 1.4% in total it paints a picture of what has been described as the worst December in 14 years for retail sales.
Sales Galore
It wasn't for the lack of sales and promotions, that's for sure. Just about every major store, bizarrely including banks, offered some sort of seductive crash in prices and still we did not get out and buy in numbers. Even the lure of the weak pound, Gordon's VAT giveaway bonanza and big discounts did not lure enough foreign shoppers to British shops to give us their nice fat Euros. It was indeed a bleak Christmas.
The BRC survey of its 6,000 company members who employ around 680,000 people, has indicated that trading confidence rapidly declined at the end of the year. I get no satisfaction stating what I felt was the obvious but the BCC report basically says that the 'UK economy is facing a very deep recession and that the downturn is continuing at an alarming pace'.
Recession-Proof Businesses?
I come back to my point from previous articles - if you think you have a recession-proof business you are living in a dream world.
Even if you are set to benefit, it will affect your busienss and you need to plan for it accordingly. However, the vast majority of businesses will be adversely affected by this recession and if they haven't felt its full force yet, the next quarter may come as a severe shock.
What these reports say echoes my beliefs - the recession will hit hard and at alarming speed. One minute graphs and confidence will be up, sales going fine and the next the world turns upside down and you face a fight for survival.
The only areas in the BRC report to show growth was food in general with Sainsbury's, Greggs and Tesco fairing very well while on the hybrid side John Lewis showed excellent growth possibly at the expense of its rival M&S who have rather publicly been forced to shut several of their newer Simply Food outlets and lay off over 1,000 staff.
When Will It End?
It seems we get wave after wave of gloomy news and no real substantial comment from the fools that got us here as to when we might expect relief. It annoys me that Economists/Financial-types speak rather blandly about this being 'just another recession' as their industry has been shored up by vast bail outs which means executives will still get their bonuses while they shed thousands of staff. Further, a friend said to me recently that her Event, Conference and Corporate Jolly business has never been so good and that all new business is coming from - wait for it - the Finance Sector as they jet off to swish resorts and huddle together to discuss how they can make money in the future on expenses paid by the taxpayer bail outs.
I don't think we can trust Politicians - George Bush called this 'An Adjustment' while after 10 years of drivel that we have a stable economy, Gordon Brown, in King Canutesque lunacy, declared that Britain was better placed than any other country to weather a downturn as our Finances were so good.
The fact is we are going to have to batten down the hatches and weather this one out. While on business here in Italy, there is no local sympathy for the exchange rate getting bashed by the Euro or Britain getting into a mess - the feeling is that Britain and the US were perpetrators of this Economic False Boom of the last 10 years and while Italy has got sucked in, they can smile that despite their 'unstable economy' at least their currency has stood the test and there are signs of recovery.
As the US ebbs toward the Inauguration of its new President, all eyes will turn to Barack Obama. He arrived on a wave of disillusionment with the status quo but I don't think even he thought he would be clearing up this big a mess when he started out as a fresh-faced, hopeful Candidate. The world just hopes he can shoulder that burden of responsibility and expectation and really save us rather than Gordon Brown's version of 'saving'.
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