UK consumers plan to cut Christmas spending, US holiday sales growth expected to slow
A recent survey by Accenture (NYSE:ACN) and YouGov reveals that nearly two-thirds of UK adults plan to reduce their Christmas spending due to concerns over the cost of living. This finding presents a more pessimistic outlook than previous surveys conducted by Deloitte and PwC, which had indicated only a third of UK adults intended to cut back on holiday spending.
Interestingly, over half of the respondents in the Accenture and YouGov survey also stated they won’t participate in Black Friday, Cyber Monday, or Boxing Day discounts. This reluctance comes in spite of a resilient consumer demand observed throughout the year, despite the largest two-year fall in living standards since the 1950s.
Retail sales in September experienced an unexpected dip due to unusually warm weather negatively impacting autumn-wear clothing sales. However, a change in weather conditions during mid-October spurred a spike in sales. Major retailers like Next, Tesco (OTC:TSCDY), and Sainsbury’s remain optimistic about Christmas trading, with Next projecting a 2% year-on-year increase in sales for the Christmas quarter.
Similarly, Marks & Spencer (OTC:MAKSY) is preparing for robust trading during the holiday season by hiring more temporary staff than last year.
On the other side of the Atlantic, the National Retail Federation (NRF) anticipates that 2023’s holiday sales in the US will increase at the slowest pace seen in five years. This forecast suggests that while UK consumers are planning to tighten their belts this Christmas, US consumers are also expected to be somewhat more restrained in their holiday spending compared to previous years.
