Guest 640- Registered: 21 Apr 2007
- Posts: 7,819
28 December 2009
07:3735753The shopping experience has gone ballistic on the high street uk. Its a massive success story with more being spent right now than ever before...in fact its the highest Christmas/Boxing Day spend since records began. This is odd when you consider we are in the middle of a horrific recession. The redundancies and job losses have been enormous lately, yet somehow we have managed to spend like never before.
Why is this happening? In a word...VAT! There are substantial savings to be made at the moment right across the high st. Not only do you have SALE reductions enticing you into stores, and very nice too, but you also get right now a substantial vat cut which shows real benefit when buying larger ticket goods. The public are highly aware of this situation. This vat reduction, often derided at the time, has found a beneficial sting in its tail and now the retail sector is singing its praises or at least singing the fantastic windfall it has given them over the period. Spending in a recession is good for the economy...the government have been spending their way out of recession, and so have we Joe Public by making sure our pound goes further.
So cuddly duo Gordon and Alastair, oft times bashed unjustifiably, must be relishing their holiday break with a kind of smug sigh, and ordering another slice of turkey fritter from cook!
Guest 653- Registered: 13 Mar 2008
- Posts: 10,540
28 December 2009
08:1535757I bought a new digital camera on Sunday and Jean bought her Mum a new microwave/combinmation; at no time did either of us think of the 2 and a 1/2% reduction on vat - I wouldn't have thought that anyone else did either.
£2.50 on a £100 spend. I don't really think so.
It would have had to have been a really big purchase to make much difference Paul, so I don't think in reality, vat played any part in the vast majority of things sold/in the sales, although I did hear mention of it on the tv - as an encouragement.
Roger
Guest 640- Registered: 21 Apr 2007
- Posts: 7,819
28 December 2009
08:4935758It seems people do think of the VAT though Roger and as you can see, for example, the type of adverts on television currently...ie for beds, sofas, cameras, and so on, this is the time of year that people do indeed purchase large ticket items. With the VAT going back up in less than a week to 17.5% (from its current position of 15%) then its a real extra shot in the arm for sales right now just when shops need it most. This current flurry of spending success will keep shops open and hopefully thriving... and most importantly, keep people in jobs.
28 December 2009
09:2235759I agree with Roger - the piffling amount saved even on bds and cookers will be such a minor factor as to be negligible. People who need or want to buy those items will buy them anyway and most will barely notice the saving. It is hype to encourage spending rather than a real benefit.
Guest 693- Registered: 12 Nov 2009
- Posts: 1,266
28 December 2009
09:5035766It may only be a saving of £2.50 on a £100 spend, but that translates into £25.00 on a £1000 spend, so if you're buying at the larger end of TVs, cameras or other such luxuries, it is worth taking into consideration.
What I can identify myself, as a small business, is that my takings over December are up on last December by 232%. That is a massive increase, and I suspect that it is more a result of a combination of factors - VAT, customer confidence, the strength of the Euro against the pound (I've sold loads to Italy, Spain and France)and having the right products for sale. All this despite industrial action early in the month by the Royal Mail. Toys have sold unbelievably well; customers are still looking for good deals, but I get the feeling that people have just had enough of doom and gloom on the TV and decided to enjoy Christmas. Fingers crossed, the outlook for 2010 is looking brighter than it did in the summer, but we're not out of the woods yet.
Let us hope that the successes in my own business are reflected in the High Street. Of late, the High Street has taken a battering, and it's for the greater good if the economy can be booted out of recession by a surge in the High Street. I also believe that the way we shop has changed irreversably in that the internet and out of town shopping centres such as Westwood Cross now attract more customers than ever before - and that is why I believe the smaller High Street such as Dover's needs to develop more niche shops and better quality shopping than previously. I myself bought our Christmas meat from Rooks, and our veg from the lady who has a (excellent quality) farmer's stall on Archers Court Road @ Pineham, plus a few bits & bobs at the Sussex bookshop, otherwise it all came from eBay, which offers prices much lower than other sources if you look carefully.
We have enjoyed a remarkable final quarter in the 2009 calendar year - long may it continue! Happy New Year to all............
True friends stab you in the front.
Guest 655- Registered: 13 Mar 2008
- Posts: 10,247
28 December 2009
11:0735770PaulB - People are bringing forward large (and smaller) purchases to take advantage of a combination of the lower VAT and sale discounts. This should brighten the trading figures for December and maybe show some very belated economic growth in Q4 but the price will be felt in Q1.
The Christmas/sale credit card hangover will depress sales in Q1 and we are very likely to see the economy dip before a longer term period of growth resumes. In Q3 we were shown to be one of the very few (and only G20) econony to remain in recession, the longest recession in British history, first in last out. Not a record for Brown to boast about as it is his economic policies that have made things as bad as they are.
Guest 653- Registered: 13 Mar 2008
- Posts: 10,540
28 December 2009
11:3535775Well done Andy - hope your success goes from strength to strength in 2010.
Maybe people do think of vat - for larger purchases Paul; it'll be interesting to see if sales get really depressed when it goes up - hopefully to just 17.5%
Roger
Guest 655- Registered: 13 Mar 2008
- Posts: 10,247
28 December 2009
12:0035776It is just to 17.5% Roger, thats confirmed but do not rule out an increase to 20% or more in the budget, whoever gets elected. Personally I would not want any more tax rises and would prefer to see massive spending cuts.
Yes, indeed, well done Andy, its great to hear a local business success. Sadly though this does not seem to reflect the more general trading picture with November retail sales worse than expected, though I am hopeful that December post-Christmas trading will see a boost before the New Year kicks in.
28 December 2009
14:1835788I have to say that our December was stellar too. I don't think I can thank the VAT cut because almost all of my trade is B2B but we have had a killer month from which I am currently recovering (long hours etc). Considering the recession, December certainly went off with a big bang!
28 December 2009
16:2335799business echoed for my services - we are way up this year, at last, but I don't think Vat has anything to do with it. It would have been much better to take vat off insulation products or any building work that would see local products and local labour being used .
The high street purchases you mention are all foreign goods which will adversly affect our balance of payments and see profit go out of the country
howard mcsweeney1- Location: Dover
- Registered: 12 Mar 2008
- Posts: 62,352
28 December 2009
20:4935812i wonder what the vat rate will be after the next election.
one thing is for sure, no party is going to tell the truth beforehand.
i suspect the rate will be higher than barry is suggesting, nearer to 22.5% or even 25%, failing that bringing things into the vat net that were previously exempt.
Guest 653- Registered: 13 Mar 2008
- Posts: 10,540
29 December 2009
08:0635822Good to hear that local businesses are doing well - Andy, Rick and Dave and all very different too.
I hope that vat doesn't go above 17 1/2 %, also that exempt items are left exempt.
Taxes in general I'd like to see reduced; people work better when they know they can keep more of what they've earned.
Reducing waste of one sort or another, must be worth looking at.
Roger
Guest 640- Registered: 21 Apr 2007
- Posts: 7,819
29 December 2009
08:5635827Yes very good to hear the excellent financial news eminating from local businesses/forumites as mentioned above. Well done to all those.
I heard an item on midnight news last night (R4) that high street shops are to ask if the vat situation could remain in situ until february in order to prolong the current boom. First of all this shows how powerful the current boom in spending actually is, which took everyone by surprise, it also proves the effect the VAT situation is having. Okay as we know it helps with large ticket items and companies like Moben, Magnet, Olympus and so on know that very well, as you can see on your TV, but also it gives a psychological boost to the smaller ticket item shopper as well. If he thinks prices are going up enbloc on any single day he will shop with a frenzy before that day.
But yes I suspect BarryW is right in that the curent spend will impact on Q1 but nevertheless as all our grandmothers used to say, we should make hay while the sun shines, and if the current boom is running, then lets run with it and lets have an extension to the 15% VAT period.
Guest 651- Registered: 12 Mar 2008
- Posts: 5,673
29 December 2009
12:1835832I hope not Paul, thousands of man hours have gone into preparing for the change on the 1st Jan and postponing it would would be an absolute nightmare !!
Been nice knowing you :)
Guest 655- Registered: 13 Mar 2008
- Posts: 10,247
31 December 2009
12:3335984That is so right Scotchie, it cost me more to deal with the VAT change, reducing then increasing, that it has saved all my clients....... It was mad to reduce VAT for 13 months as they did.
Guest 651- Registered: 12 Mar 2008
- Posts: 5,673
31 December 2009
19:3736016It would be even more of a nightmare if the ideas people suggesting things like staging the rise back up to 17.5% over several months !!!
Think of me logging in tomorrow morning to make sure that our systems are ready for Monday
Been nice knowing you :)
Guest 690- Registered: 10 Oct 2009
- Posts: 4,150
31 December 2009
19:5236017Having my old conservatory knocked down, and a new one put in. Ordered it 20th December, and pay for it on completion in February. My contract shows that no VAT is payable if the cash price is paid within 6 month`s. Which has saved me £820! Didn`t expect that much.
Tell them that I came, and no one answered.
31 December 2009
20:0936020My family struggled with VAT on any number of levels for years as mostly self employed sub-contractors. Nightmare!! Keep it simple I say!
Guest 651- Registered: 12 Mar 2008
- Posts: 5,673
31 December 2009
20:2336025Colin - your conservatory is costing you £37,720 ??
Been nice knowing you :)
Guest 690- Registered: 10 Oct 2009
- Posts: 4,150
31 December 2009
20:3236027
. Don`t go away Paul.
.
Tell them that I came, and no one answered.