Good Christmas sales but uncertainty for 2022

Retailers in Bridgetown are reporting great sales for the Christmas period, as last-minute shopping on Christmas Eve added to the recent VAT-free day saw a surge in spending activity.

However, two of the island’s main retail stores are cautious about the prospects for 2022, as supply chain issues and skyrocketing freight costs continue to loom over the sector.

Managing Director of Abed’s, Eddy Abed praised the Government’s foresight in implementing Monday’s VAT-free shopping, saying that the move energized great levels of spending.

“Most retail stores would tell you that they do 70 per cent of their turnover between October and December, so I don’t need to tell you how critical it is that we build as much fat as we can at this time of year to carry us through the lean period next year, and I am very mindful of that,” he said.

“I am thankful that the Government gave us the opportunity to have that VAT-free day. The sales on that day, in particular, were a record for us, and I don’t need to say any more. People understand what removal of VAT means, they understand how much more their dollar can stretch when it happens, and we were well prepared for it.”

Abed added, however, that the issue of freight was still the number one factor controlling prices. He said shipping costs and delays had negatively impacted profit margins.

“This year, 60 or 90 days to make it became 150 days, because the factories in China are being stressed with COVID, a lot of them are closed, or because of [the COP26 climate summit], in terms of trying to reduce the amount of pollution China is putting into the air, they have cut back a lot of the hours that the factories worked,” the businessman explained.

“Freight went through the roof; it literally went up five times. A container out of China was around US$4,000 last year; this year it became US$22,000, so the cost of everything you put into the container became that much more expensive.”

Managing Director of Woolworth, Martin Bryan expressed similar sentiments. He said although sales during the Christmas season were good, shipping delays remain an area of worry going into the New Year.

“We had some serious logistical problems in terms of supply. For instance, our Christmas trees, we have not even gotten them yet. So we will be early next year with them but that is a cash flow problem because that is money now tied up in trees. Some of our decorations are coming late, curtains are coming late, so we had some serious issues in terms of supply.

“Freight affected us because freight from the Far East almost quadrupled compared to the same time last year, so that certainly would have affected what we had on our shelves and what we offered customers,” Bryan explained.

The vendors and merchants operating on the streets of The City continued to see a hive of activity, with one male vendor who preferred not to be named saying that clothing sales had gone well this week, although they were still not back to pre-COVID levels.

“Sales were alright overall…. I was glad we had a lot of traffic over the last two weeks or so because before it was looking real bad, I won’t lie. I know people don’t have a lot of money right now to spend on extra things so that was part of the reason, but it was real rough for most of the year trying to get items [sold] at a steady pace,” he said. (SB)