|
Consequences of January Snowfall Worse Than Expected
Listed under: News
Published: Tuesday, March 16, 2010
Severe weather conditions during December and January could have cost small businesses up to £7 billion this year, seeing retailers in the UK experience their worst winter loss for decades, according to a recent report from Lloyds TSB Commercial.
The findings, which reveal that around seven in ten smaller enterprises were affected by the heavy snowfall, with staff absences and poor footfall just some of the factors impacting sales, show that four in ten businesses were forced to close as a result of the poor weather, with approximately one in eight companies lose more than £10,000 in profits during the first two months of this year alone.
Loss of trade was the biggest problem, with disruptions to travel, delivery services and a general decline in high street shoppers also exacerbating the situation.
However, non store sales, including mail order, internet and phone orders, experienced significant growth during January and February, rising 14.6% and 15.5% respectively.
Despite the negative findings, business specialists are encouraging retailers not to feel too downhearted by the report, suggesting that the poor start to 2010 is unlikely to have a lasting impact on their performance over the next year. Speaking to Reuters UK, Sarah Peters, senior retail analyst at research company Verdict Research, says, “People are always going to avoid visiting the high street during bad weather and, while this will hit individual businesses, the overall affect on the economy will be minimal.”
She adds, “January is a weaker month for retailers anyway so they won’t have expected big sales and there will be much bigger things going on later in the year that may well have more of an impact on the economic recovery than just a few weeks of bad weather.”
Philip Shaw, chief economist at private banking firm Investec, agrees, adding, “It is highly unlikely that the poor weather conditions will jeopardise the economic progress. The industry can recover lost output and even if demand did fall back as a result of the bad weather, while it might have some impact on output over the first quarter as a whole, it will not be particularly significant.”
How did the bad weather affect your business this year? Email your thoughts to .(JavaScript must be enabled to view this email address)
The findings, which reveal that around seven in ten smaller enterprises were affected by the heavy snowfall, with staff absences and poor footfall just some of the factors impacting sales, show that four in ten businesses were forced to close as a result of the poor weather, with approximately one in eight companies lose more than £10,000 in profits during the first two months of this year alone.
Loss of trade was the biggest problem, with disruptions to travel, delivery services and a general decline in high street shoppers also exacerbating the situation.
However, non store sales, including mail order, internet and phone orders, experienced significant growth during January and February, rising 14.6% and 15.5% respectively.
Despite the negative findings, business specialists are encouraging retailers not to feel too downhearted by the report, suggesting that the poor start to 2010 is unlikely to have a lasting impact on their performance over the next year. Speaking to Reuters UK, Sarah Peters, senior retail analyst at research company Verdict Research, says, “People are always going to avoid visiting the high street during bad weather and, while this will hit individual businesses, the overall affect on the economy will be minimal.”
She adds, “January is a weaker month for retailers anyway so they won’t have expected big sales and there will be much bigger things going on later in the year that may well have more of an impact on the economic recovery than just a few weeks of bad weather.”
Philip Shaw, chief economist at private banking firm Investec, agrees, adding, “It is highly unlikely that the poor weather conditions will jeopardise the economic progress. The industry can recover lost output and even if demand did fall back as a result of the bad weather, while it might have some impact on output over the first quarter as a whole, it will not be particularly significant.”
How did the bad weather affect your business this year? Email your thoughts to .(JavaScript must be enabled to view this email address)
