People walk along Regent Street
(Picture: REUTERS)It’s that time of year when A Christmas Carol returns to our screens but another Dickens classic comes to mind when reading today’s corporate results: A Tale of Two Cities.
Updates from two retailers show there are quite literally haves and have nots in the City: those who have stock, and those who don’t.
In the first camp is Pets at Home. The retailer is gearing up for a bumper Christmas after the pandemic ushered in a heap of new pet owners. Many are expected to pamper their fur babies. Pets at Home plans to take advantage by stocking up on dog treats and festive harnesses for cats (really — look it up).
Then there’s AO World, which is struggling to get hold of PlayStations and is seeing the cost of things like fridges rocket due to a supply chain squeeze.
Investors are giving AO’s stock a pummelling as a result. The business is days away from Black Friday sales and in the midst of Christmas trading. Retailers make most of their money for the entire year during these crucial few weeks.
Economists talked about a two-speed recovery for the economy after the pandemic: tech and other flexible “knowledge” businesses zoomed ahead, while the likes of hospitality and entertainment stagnated or even shrunk as the impact of restrictions lingered. In the argot, this is a K-shaped recovery.
By the looks of it, retailers could be in for a K-shaped Christmas: those who can get stock should be quids in as festivity-starved Brits go all out. Those who can’t face thin gruel on December 25.
