World Cup flops are bad for business
Jun 28 2010
A net loss for England
Disappointment with England is a familiar emotion to footie fans up and and down the country, but many businesses will have the added frustration of seeing a knock-on effect in consumer spending.
Darren Evans, manager at Islington-based pub The Trader, says: ‘England’s defeat is definitely going to have a big impact. I think that’s something that will be felt in both small independent pubs and large chains across the country.’
Owen James, economist at the Centre for Economics Business and Research, says the food and drink sectors would have been the biggest beneficiaries from an England victory. ‘The longer they’d stayed in the World Cup, the bigger the boost to sales [in these areas],’ he says.
Howard Archer, economist at financial analysis firm IHS Global Insight, says: ‘No doubt England shirts, flags and general England World Cup merchandise are now being consigned to the reduced price baskets.
‘But there could be a significant boost from the match for any potential suppliers of goal line technology among UK companies. Although knowing our luck, German businesses have probably cornered the market for that as well.’
However, Krisham Rama, spokesperson for the British Retail Consortium (BRC), says the overall loss to high street spending will be small. ‘It would have been a useful boost, but the majority of spending happened in the run-up to the World Cup. Consumer confidence is the most important factor and things like the VAT increase are likely to have a much bigger effect on spending patterns.’
According to the BRC, the previous World Cup tournament in Germany was worth £1.25 billion pounds to the UK economy.
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