Despite the challenges posed by the pandemic, the West End of London is making a remarkable comeback, thanks to the support of affluent consumers, according to the latest data from the New West End Company (NWEC). This is encouraging news for an area that was hit hard by the pandemic, as online shopping became the norm for office workers, tourists, and local shoppers. Previously, the NWEC had predicted that the West End would achieve its pre-pandemic annual turnover of £10 billion by 2025, with the reintroduction of VAT-free shopping playing a crucial role. However, the removal of this perk shortly after the prediction caused concerns about the area’s ability to meet its target.
Nonetheless, both the NWEC and global property consultancy Colliers remain optimistic and believe that the £10 billion goal is still attainable. The updated figures show a 56% increase in sales compared to 2021, with spending outpacing footfall and visitors spending more per visit. Surprisingly, tourists are returning at a much faster rate than expected. Representing 600 retail, restaurant, hotel, and property owners in Bond Street, Oxford Street, Regent Street, and Mayfair, the NWEC reported that the area’s turnover in 2022 reached £8 billion, a significant jump from the previous year but still 11% below 2019 levels.
Of particular note is the shifting dynamics between spending and footfall, with spending surpassing footfall growth. This indicates a change in consumer behavior, as visitors to the West End are making fewer visits but maximizing their spending during each visit. This trend is partly driven by high-spending international visitors, who are recovering at a faster pace than predicted and are expected to fully return to pre-Covid levels by mid-2023 to early 2024.
In terms of successful sectors in 2022, health and beauty, electrical goods, and department stores performed exceptionally well. The growth in health and beauty sales reflects the increasing importance consumers place on well-being and self-care. However, the NWEC anticipates that sales in the next two years may be lower than previously forecasted due to the challenging economic climate.
While acknowledging the tough road ahead, Dee Corsi, Chief Executive of the New West End Company, underlined the resilience of the West End. Corsi said, “Although the next two years will be more challenging than originally anticipated due to rising costs across the board, the West End has continued to prove its resilience in 2022, and we are still on track to reach £10 billion in turnover in two years. The return of international visitors towards the end of last year provided a much-needed boost, but we must acknowledge that they are not returning at the same rate as destinations like Paris and Milan, primarily due to the availability of tax-free shopping on the continent.”
While the road to recovery for the West End may not be without obstacles, the impressive performance driven by high-spending consumers and an uptick in the number of tourists offers hope for a brighter future. With the right strategies and initiatives in place, this iconic London district has the potential to achieve its ambitious financial goals and reclaim its position as a thriving retail and entertainment hub.
Useful links:
– New West End Company Official Website
– Colliers Official Website
