“Trump slump or May sway?”
Posted by James Fell on
“Here we go round the mulberry bush” one customer said on hearing the news of a General Election in June this year
This is in fact the 17th General Election that the Queen has been through as monarch, and the 11th that Partridges has been through as a food shop. More to the point, it is the third national vote in three years if you include the EU Referendum last year. Will election fatigue trigger speciality food fatigue?
Traditional views hold that general elections, being uncertain processes, tend to slow economic growth and dampen sales. However, from past experience and from the speciality food side of things, the question is “are we going to notice any difference at all either before, during or after the election period?” – probably not, in my opinion.
As I said earlier, Partridges has been through 11 General Election campaigns in its time, resulting in the pendulum swinging to five labour victories, five Conservative victories and one coalition. Because we are selling speciality and artisanal products and because we are based in an affluent area of West London, the results of elections do not normally affect customer spending patterns. For example, in 1983, which was a resounding Conservative victory under Mrs Thatcher, our sales were significantly up in the following year. This pattern was repeated in 1987, when there was another convincing Conservative victory and sales rose once more by a good margin. However, in 1992 when the Conservatives won under John Major and economic storm clouds were assembling, our sales dropped by 9%. In 1997, when Labour won its own resounding victory under Tony Blair, sales remained level. In 2001 and with another Labour victory, sales declined by 5%, but following 2005 with another Labour victory sales rose by 9%. In 2010, with the Coalition’s victory, sales were up 6%, and in 2015 with a Conservative victory, sales rose by 8% the following year. A brief analysis might be that sales drift upwards with inflation and may be boosted by a Conservative victory but are not adversely affected by a Labour one.
Consumer spending is at best always unpredictable, but it seems that expectations play a large part. It is rather stating the obvious, but when there is a positive outlook or stability there is less inhibition to spend.
However, it is also true to say that we have not been affected too badly by recessions either. We opened in 1972, just prior to the 1974 recession. We expanded in size to three units in 1984 just after the recession of the 1980s. For the recession in 1990 we kept our heads down, but it seems that in difficult times food that is of good quality and has an interesting provenance holds its own. The downside may be that in good times food retailers do not enjoy the boom as much as other sectors of the economy. It is important to reiterate that we at Partridges look at this through the prism of West London retail experience. It may be depressing to think of the political situation at times, but on previous experience this is unlikely to affect sales.
It is also important to note that many people are not interested in elections in the first place. Voter turnout in British elections remains low compared to other countries. Last year at the EU Referendum, 12 million people did not exercise their right to vote. During the 2012 American elections 129 million people confirmed their intention to vote but 171 million people confirmed their intention to celebrate Halloween, according to one poll. Which goes to show the increasing importance of events in the life of a speciality food shop rather more than elections.