comment: Retra
E
vents which many of us have experienced in our lives (and hoped
never to experience again) have come to fruition. The spectre of double-digit inflation coupled with supply chain problems and strikes in many key sectors are not something any of us expected to see. Then, add in a full-scale war in Europe, the death of our Queen and three Prime Ministers, and it is obvious that 2022 will long be remembered by all of us. The old saying “you couldn’t make it up”
feels quite appropriate. At this time last year I genuinely don’t think the most imaginative of novelists could have come up with a plot to rival the events of 2022. Reflecting on our industry, for most 2022 was
not too bad. The lifting of Covid restrictions has seen a return to the high street of the consumer and many shops are showing modest growth. This has of course been tempered somewhat by a decrease in online. The numbers for our industry over the festive
period are roughly flat. Volume is down by 10%, but value is up by the same amount, 10%. It is, therefore, crucial that margins are maintained. We all know that both we, as consumers and as businesses, have already seen very significant price rises. Some of the December numbers are quite scary. Food inflation accelerated strongly to 13.3%. Fresh food inflation hit 15%, the kind of numbers not seen for decades. For people that aren’t “of a certain age” then this is a massive shock. In our sector, inflation was steady at 4.4%.
Many manufacturers are on their third or fourth round of price increases and unless things change this is set to be the trend for 2023. I’m not totally against price increases, as I think we have sold our goods too cheaply in the past. Some of the items we sell as an industry are essentials. No household wants to be without a washing machine or cooker and we could all add additional appliances to the list. The challenge comes when people see their disposable income eaten away, literally, by day- to-day living costs. It means that a new “essential” appliance may need to be “affordable”
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www.ierdaily.co.uk
Consumer
confidence will be key to how things
work out in 2023 Retra chief executive Howard Saycell says that when we reflects on 2022 it feels like we’ve been in something of a time machine
rather than “aspirational”. Or the upgrade of the TV to a larger screen with more features will simply have to wait. Consumer confidence will be key to how things work out in 2023. If we see inflation start to fall, which is one of our Prime Minister’s five objectives, then this will help, but there are so many external factors that also play a part. Energy bills are a real concern for most households along with increasing mortgages and rents. Whilst many retailers have benefited from the Energy Bill Relief Scheme, the government has yet to announce any extension of the scheme.
Our members in big cities have been severely
hit by lack of people thanks to “flexible working” and ongoing public transport strikes. I could go on with more doom and gloom, but actually I am relatively optimistic for 2023. If our Prime Minister can deliver on his five
January 2023
pledges then 2023 should be better than 2022. At least we may begin to see some light at the end of the tunnel. Retail and hospitality, both of which are vital to the UK economy, must continue to receive support if we are to avoid a deep recession. If we look back over the pandemic and now
everything else that is happening, our sector has remained remarkably resilient. I am confident that even in these challenging times good independent electrical retailers will continue to prosper. Let’s face it, there isn’t much more that can be thrown at us than we’ve experienced over the last few years.
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