RETAIL FORECASTS REPORT 2021 | BDO LLP
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TRAVEL &TOURISM UK travel & tourism saw a turbulent finish to 2019, with the collapse of Thomas Cook, the rise of online only travel agents, such as Booking.com and Expedia, which left the travel agent unable to compete. This left many British holidaymakers stranded abroad and in need of repatriation, while 2020 also carried a potential risk in that the lack of a British-EU trade deal could have added extra barriers to travellers from and to the UK had the ‘transition period’ not been extended. Of course, the spread of COVID-19 quickly dwarfed these previous concerns and International trips are predicted to see a 40% year- on-year decline. Widespread travel restrictions from March onwards forced operators to refund flights and holidays, as new bookings dwindled. Even as restrictions lifted from July, demand, particularly for foreign holidays, was dampened by consumer anxiety over the potential re-introduction of restrictions, the possibility of having to quarantine and fears over the virus itself. These same issues also applied to travellers into the UK, with London in particular seeing a massive drop in footfall, with many of its tourist attractions, bars, restaurants, and other features either closed or operating under heavy restrictions. VisitBritain is forecasting inbound tourism to the UK to fall by 74% to 10.4 million, with related spending dropping 79%, to £6.1bn, and Springboard reported footfall in central London was 69% lower in July 2020 than July 2019. Many Brits have been encouraged to take staycations instead, particularly to South West England, where consumers could enjoy beaches in a less daring setting, with less risk of being subjected to quarantine. However, businesses are still restricted as to how many guests they can accommodate, making it difficult to ‘catch up’ on the months lost to lockdown. They are also having to meet increased customer expectations around hygiene and booking flexibility around ‘local lockdowns’.
Travel industry news service TTG launched a “Holiday To Help Out” scheme between 2-8 November, with participating suppliers on the dedicated website holidaytohelpout.com aiming to excite and tempt consumers with significant discounts on holidays that were available only through travel agents. Easyjet Holidays, Virgin Voyages and Intrepid were among the businesses to participate, but with no Government assistance, and the dates of the scheme meaning it was thoroughly upstaged by the announcement of Lockdown two and its new tranche of travel restrictions, the initiative was effectively hamstrung before it could get going. Recovery is set to be led by domestic tourists, before international travel and tourism begins a more gradual revival, as the global health battle against COVID-19 hopefully starts to contain and diminish the virus. Unfortunately, it seems likely that the uncertainty and challenges facing the travel, tourism and hospitality sector will continue well into 2021. Recovery is set to be led by domestic tourists, before international travel and tourism begins a more gradual revival, as the global health battle against COVID-19 hopefully starts to contain and diminish the virus. This could provide more favourable and stable conditions for businesses which have repeatedly had the rug pulled from under their feet in 2020. While lack of holidays has generally assisted retail spend, affording consumers more disposable income, retailers relying on incoming tourism, particularly those based in London and/or operating in luxury sectors, have had a much less favourable time and for these too, recovery will be a slow process.
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