Lux­ury shop­pers crowd UK cap­i­tal for Brexit bar­gains

Kuwait Times - - BUSINESS -

While the prospect of Brexit is weigh­ing on much of the Bri­tish econ­omy, tourism and lux­ury goods busi­nesses are cash­ing in on bargain-hun­gry vis­i­tors lured by the slide in the pound. Lon­don’s tourism agency says sales of goods el­i­gi­ble for sales-tax ex­emp­tion have gone up by a third since the Brexit vote in June, which sent the pound ster­ling plung­ing against the euro and dol­lar. “We cal­cu­lated that over the last four months it’s been about 12 per­cent cheaper for Euro­peans to come and shop here,” said Chris Got­tlieb, head of leisure mar­ket­ing at the agency Lon­don & Part­ners. The pound is now at 1.17 eu­ros com­pared with 1.3 eu­ros be­fore the shock vote to leave the Euro­pean Union, while it has also fallen to $1.25 from $1.49. The re­sult is that Lon­don has be­come the cheap­est city for lux­ury goods shop­ping in the world in dol­lar terms, ac­cord­ing to a study by Deloitte.

‘Go­ing to spend much more’

In tourist ar­eas, the ef­fects are ev­i­dent. “We’re go­ing to spend much more money than we planned to,” said Ra­dostina Nonova, a Bul­gar­ian tourist, laugh­ing as she lugged her bags on Carn­aby Street in the heart of Lon­don’s shop­ping dis­trict. “We didn’t plan to shop too much but it’s ob­vi­ous that the prices are very good for us. “So we shop and we can af­ford to eat and drink out­side. That was not pos­si­ble years ago,” she said. French tourist Christophe Disic said he did not come just be­cause the pound was low but “when we changed our money we re­alised we had a few more pounds for fewer eu­ros”.

When speak­ing to US tourists, shop­keep­ers are quick to take out their cal­cu­la­tors. “We’re an Amer­i­can brand. Our prod­ucts are de­signed and as­sem­bled in the States. But with the weak­en­ing of the pound it ac­tu­ally hap­pens to be cheaper for the Amer­i­can tourists to buy an Amer­i­can prod­uct in Lon­don,” said De­nis Sa­ga­jevs, who works in Shi­nola, a shop sell­ing watches and leather ac­ces­sories. “It’s af­fected by the fact that they can claim VAT on their way back. We pretty much on a day to day ba­sis ex­plain that to cus­tomers from the States. It hap­pens to be quite a strong sales driver,” he said.

Some shops are adapt­ing their ad­ver­tis­ing and sales tac­tics to the new con­sumer be­hav­ior. “Be­fore the vote, Euro­pean tourists were cou­ples who came to be to­gether and maybe bought a cou­ple of things,” said James, the man­ager of a lux­ury men’s clothes shop on Carn­aby Street. “Now, there are groups of friends who rush in. They grab ev­ery­thing they can carry.” James es­ti­mated that Euro­pean and US shop­pers com­ing to his store have in­creased by around 50 per­cent. In­stead of spend­ing on costly ad­ver­tis­ing in Bri­tish news­pa­pers as it did be­fore, his firm is chang­ing tac­tic to ap­peal more to over­seas vis­i­tors. — AP

LON­DON: Pedes­tri­ans carry shop­ping bags in Ox­ford Street in cen­tral Lon­don. — AFP

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