As those of you who subscribe to Circana data will know, the year has got off to a highly respectable start – the headline news is that the UK toy market has seen sales increase by +7% in value and +3% in units for the months of January and February, and hopefully March has continued that trend. Obviously this performance is most welcome, as we know what lies in store for the UK economy next month, so better to be ahead at this stage of the game than lagging behind with ground to make up, when economic headwinds are about to get brutal.
The list of consumer prices that are set to rise is eye-watering: energy, water, broadband / streaming / mobile, council tax, car tax and TV licence bills are all due to increase. All businesses will have to grapple with an increase in National Insurance contributions, while retailers will also have to factor in a rise in the minimum wage and a cut in business rates relief. You only have to throw in the line “Orange man and Russia’s war, I can’t take it anymore” and we have a 21st century update to Billy Joel’s legendary ‘We Didn’t Start the Fire.’
Retailers from every channel are already starting to look at how they navigate the coming months. Fenwick, Hobbycraft and Poundland have all appointed advisors to look at potential restructuring or even a sale. Frasers staff are under consultation, while other retailers are undoubtedly exploring their options to balance the books and maintain a viable operation.
But as another old 80s song goes, ‘When the Going Gets Tough, the Tough Get Going’ –
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