By Claire West
A new survey of small and medium sized companies in the UK has found that a significant majority of retail and distribution companies are not expecting events in London this summer to boost their performance this year.
The survey, commissioned by AXA Business Insurance, found that over three quarters (78 per cent) of respondents representing retail and distribution companies think the expected increase in visitors to London will have no effect whatsoever on their trading.
Moreover, 14 per cent of respondents within these sectors suggested events would have an adverse effect on trading; with only nine per cent optimistic that there would be a positive impact on their business.
Darrell Sansom, Managing Director, Direct and Partnerships at AXA Business Insurance, commented: “Many analysts and trade authorities have forecast that events in London this summer will provide a much needed commercial injection into the UK economy. While it’s true that London-based retailers should be optimistic about the opportunity, the impact is likely to be less positive for those businesses not located in the capital.”
Respondents to the survey representing retail and distribution companies maintained a conservative outlook with regard to the growth of their business over the next six months, with only just over a third (35 per cent) expressing some sense of optimism and only seven per cent suggesting they were planning on hiring any new employees this year. A majority (64 per cent) were also forecasting a lower profit this year, compared with last.
Sansom continued: “Despite the influx of visitors to the UK and general festivities, there is concern among retailers as to whether this will generate the surge in spending that many analysts predicted early on. The fact that so many of our nation’s high streets are peppered with local, non-London based retailers who are not predicted to see much commercial benefit from events in the capital, puts a slight damper on the whole spirit of them.”