Small Businesses Hit by Olympic Downturn
Traders in the capital have been complaining about a dramatic fall in business as a result of the staging of the Olympic games in the city.
The Bank of England has predicted a 0.2% boost in GDP for the Q3 2012. Patrick Foley, Chief Economist at Lloyds Banking Group, has predicted that the GDP impact of London 2012 could be as high as an additional £16 billion to the economy. The Olympic Games’ organisers have also boasted of the business benefits of staging the event.
The Olympic Park’s Westfield shopping centre is apparently seeing an increased footfall of around 40,000 more shoppers than expected and Culture Secretary, Jeremy Hunt, has echoed this by saying:
"We are getting record numbers of people coming to London and overall the picture in the East End of London is very encouraging."
However, figures from data analysts Experian, show that trade in the West End is down by 4.53% and in east London stores it is down by 9.6% compared to the same period last year.
London’s cabbies are also seeing a big drop in business with King’s Cross station, for instance, seeing fares plummet. Anecdotally, business for the capital’s black cabs is down by between 20 and 40%.
Sports Minister, Hugh Robertson, dismissed any complaints of a drop in trade by saying that London businesses have had "ample time to plan" for the expected impact of the 2012 games. Speaking to the BBC last night, Robertson said:
“This is hardly a surprise, it’s not been a great secret, the London Games were won seven years ago, we’ve all known this was coming, there has been ample time to plan for it, to put in place marketing strategies to make the most of it.”
Messages from organisers for Londoners to adopt flexible working and for non-essential visitors to stay away may have worked too well with the Association of Leading Visitor Attractions seeing a ten percent drop in visitor numbers and a subsequent drop off in passing trade for some London traders. Chief Executive, Bernard Donaghue, added that there was an upside to the downturn:
“Ironically there has never been a better time to visit our attractions because the queues are shorter and opening times have been extended.”
Boris Johnson offered a more balanced answer to the official channels, recognising both the upturns and falls in trade admitting that trade was "patchy".
Steve McNamara, General Secretary of the Licensed Taxi Drivers Association, was more downbeat about trade for his clients;
“Normally about 90% of our customers are Londoners but they’ve all left the city and haven’t been replaced by tourists.”
“I don’t know where all these tourists are or how they’re getting about, but London is like a ghost town.”