UK retail weighs up government’s economic gamble – Andrew Denye speaks to Drapers

Head of Retail, Andrew Denye, recently spoke to Drapers about the implications of the UK government’s mini-budget for the fashion retail industry.

While certain elements of the tax-cutting mini-budget have since been reeled back or cancelled, certain elements key to the retail sector remain, such as the scrapped plan to increase corporation tax from 19% to 25%.

Opinion is divided within the fashion industry as to whether such measures are enough to stimulate the economy, with some citing the need for a proper stimulus; free trade with Europe and a windfall tax on energy companies.

Energy prices indeed seem to be the key concern of fashion retailers, with some stating they are expecting up to a four-fold increase in energy prices and others, Denye explains, postponing the opening of new shops because of these fears.

Andrew said: “This is unprecedented, at least not since the 1970s – retailers are pulling out of new leasing deals because they don’t think they can afford the energy bills, not because of rents or business rates.

We’re likely to see shops turn down the temperature, dimmer the light and even reduce opening hours.

The energy cap announcement will have offered some in the retail and hospitality sector a bit of breathing space to trade through the Christmas period. While it does provide some respite, it doesn’t deliver long-term security or enable businesses to plan beyond that timeframe.”

This article was first published on 27 September 2022 in Drapers and is available to read here in full.