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So tough for border retailers

By Donald C McFetridge

Published 15/12/2015

As we enter the final two weeks of Christmas trading, retailers on both sides of the border are battling it out for market supremacy
As we enter the final two weeks of Christmas trading, retailers on both sides of the border are battling it out for market supremacy

As we enter the final two weeks of Christmas trading, retailers on both sides of the border are battling it out for market supremacy.

In 2009, I gave an interview to BBC Radio 4 in which I pointed out that traders in border cities like Newry and Londonderry were experiencing an unheralded boom in the retail sector due to a marked increase in the number of southern shoppers travelling north to spend their hard-earned euros. The car parks in these cities were packed to capacity with southern-registered vehicles.

In fact, it has been variously estimated that, at the time, southern shoppers accounted for approximately 40% of trade in the leading supermarkets in these cities. However, this year the tables have been turned.

Due to the strength of sterling to the euro, it's traders in Dundalk and Letterkenny who appear to be experiencing stronger trading patterns. Of course, it's always been swings and roundabouts in respect of this issue, but this year it would appear that retailers in Londonderry and Newry are playing host to a sharply reduced number of southern shoppers.

In the past, retailers in border towns and cities used to offer southern shoppers premium exchange rates on the euro, in some instances even beating what was on offer in high street banks.

Historically, cities like Londonderry and Newry have relied heavily on cross-border trade, but this year they are experiencing a very perceptible slowdown in trade from places like Lifford into Strabane, Letterkenny into Londonderry and from Dundalk into Newry.

The principal problem this year is that not only are traders in our border towns and cities welcoming fewer southern shoppers, they are also experiencing "leakage" (losing out on indigenous trade due to the fact that there are more northern shoppers travelling south in search of bargains).

Christmas retailing is of major importance for all retailers, but it is particularly important for our independent retailers as they seek to balance the books in what is still an extremely competitive and cut-throat market.

As everyone knows, empty tills are the first sign pointing to empty shops and more "to let" signs come January.

  • Donald C McFetridge is a retail analyst at the Ulster University business school

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