Happy Christmas or Cold Comfort?

Airports around Europe may have ground to a halt this month as poor weather and delayed flights impacted, but it’s been a more mixed picture for retailers across the region. Even in those parts of northern Europe most affected, (for once it isn’t the south which is suffering), most retailers are hoping this will only be a disruption not a disaster.

The worst hit market has been the UK, where the “wrong sort of snow” and cold weather (surprising in winter) brought travel chaos and dented what had been a promising start to the festive trading period. Weather permitting, the Sales period into January could be busy but this will be cold comfort for those retailers who have to slash margins to try to make up for lost turnover.

Seasonal fluctuations aside, Europe’s retail market has actually fought back well from the collapse in sales seen in 2008/9, but this rally stalled back in October – not when the first flakes of snow fell in November. Set in an historic context this was certainly disappointing. Over the last 10 years October has been one of the strongest trading months. However trends vary market by market and also tend to be highly volatile. Hence we know we can’t generalise too widely. Germany for example saw sales leap over 5% in October and Russia by nearly 4%.

European Retail – Back from the Trough
All Europe averages, Eurostat

Cushman & Wakefield, European Research Group

What is more,  the trend for the year overall has been relatively good and on and off the record comments from retailers have tended to be positive, particularly from Value but also some Luxury brands. Hence while November’s figures are likely to be weak – it’s traditionally a poor month and adverse weather didn’t help – further snow aside, the prognosis for December outside the UK is actually pretty good. The worry must be more that Santa will be spending a lot more time in some countries than others and that the hangover in 2011 may take longer to fade than usual – so enjoy the holidays, while and where you can!

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