What’s going on with the UK economy?

When a series of the Apprentice is on this blog spot on a Thursday morning is usually about my thoughts on the latest episode.  However I had a very busy day yesterday and got home at 1030pm.  I had intended to watch the programme then but felt that as my husband had waited up for me.  A chat rather than watching TV should be on the agenda and we caught up on each other’s day instead.  I am President of the Scottish Borders Chamber of Commerce which last night had an event to discuss the current economy which both myself and my husband attended.  I was then asked to a dinner with key local businesses (again I was there with my chamber hat on)  to talk about the economy.

So our late night discussion last night centered on a topic that has been high up on our agenda’s for the past few years which is the UK economy and where it is going.  And what it means for our two businesses, our clients and what it means for us personally.  As in all three areas the past couple of years have been a rollercoaster. 

I have been thinking about the economy a lot recently.  Firstly with my chamber hat on it has been the theme for this week’s event.  Feedback from members was interesting most agree that we have been through really tough times, relieved to have got through it and there were some signs from some that things are starting to improve again with growth in 2011.  For other’s they are still going through the tough times and hoping that they do make it out the other end.  Fuel costs, utilities and the rise in vat have hit many businesses.  Feedback though from economists at the event was that the business sector was starting to move again but it was the householders that were of concern.  Yes that is you and I who are still facing reduced income with rising costs so are calling canny and not spending as much as we did before.

However surely success of some businesses is determined by householders or consumers like you and me?  Retail certainly is and at the dinner afterwards large retailers in the area commented that market conditions were tough as consumers who would not have haggled previously are shopping around for the right price.  This view has been validated by other local retailers I have talked with and also by research on 2011 consumer trends.  Tourism is also affected by reduced household income as people are holding back on short breaks and saving for one summer holiday.  Oh for the days of short breaks lets hope they come round again but I couldn’t tell you the last time I had a short break.  And  I counted that I used to have at least 6 a year pre 2008.  Now I am just very grateful that we are going on a summer holiday but that does have an impact on the UK tourism industry as I know my change is not isolated.  Equally high fuel prices means that people are travelling shorter distances which again impacts on tourism destinations especially those further afield.  We were discussing this at the Chamber board last night and hoping that it will benefit the Scottish Borders with our proximity to the North of England.  One sector of the tourism industry who are benefiting is the caravan and camping market and lets hope this continues.  For others though it’s really hard work with fewer rewards at the end of the day and many more issues to juggle with.

I am not an economist and even they don’t really seem to know what lies ahead for the UK economy as there are so many if’s and but’s to consider.   I am though a marketing expert and part of my job is to people watch and anlayse past, current and future trends.  My personal view is that the last few years have changed consumer behaviour forever and we are not going to go back to the days of credit spend and live in today who cares about tomorrow.  As you do I was discussing this with a friend in the village as we watched our son’s play football the other week.  Our conclusion was that business has fundamentally changed for ever and businesses who do not appreciate that are not going to survive. 

I have written before that the recent economic conditions has changed my behaviour and I don’t think even if my finances changed that I would go back to my old ways of spend,spend.  Gone are the days when I would whittle away £100 on clothes that I don’t need on my way home from a meeting followed by even more wastage in the Marks and Spencer’s food hall.  Interestingly a retailer who specializes in supplying the main UK retailers said that the shops are finding that where as before people wanted to buy cheap throw away items after a couple of wears.  They now want goods that are more expensive but that will last.  Equally I now want to buy local food and would rather now buy from my butcher and know the food is from local farms than buy a meal deal from a supermarket where the food could have come from across the world.

Personally I think this gives a great opportunity for local retailers who have quality goods not found on every shop in the high street, who can offer good customer service and make you feel special.  However this only can be done if they realise that they need to market themselves not sit in the shop and hope that people will find a reason to find them.  Social Media is great for this and all it takes is time.  One of our retail client’s finds that people actually come into the shop to look at the goods they have seen mentioned on Facebook and Twitter. There are other cost-effective ways you can communicate such as running a competition in your shop and using the data to create an email database where you can send out regular updates to customers.  Or collect mobile number and text them in a timely manner of course. 

For the tourism industry 2011 is going to be an interesting year.  To date it’s been one of price haggling for the hotel sector where every week you see in the papers even the big guys dropping rates to get people into rooms.  Attractions on the other hand may be benefitting from an increase in day trips.  In theory self catering in the main season should benefit from people staying closer to home but this could make for a tough off-season.  What do you do?  Well our advise again would be to most importantly communicate with your existing customers both local if applicable and room guests.  Give them reasons to visit you and the easiest way again is to use a enewsletter tool like mail chimp.  Don’t save this for once a year do it frequently and remember don’t just sell your product but also the destination that you live in.  Your clients my love your product but part of that will be because they love the area you are located in.  Use that to give them a reason to return.  Use Social Media again Facebook is a great tool for loyal customers and Twitter is a cost-effective way of raising awareness and getting new customers.  But like retailers what ever you do don’t do nothing and sit and moan.  Be pro active yes the landscape has changed, no we don’t know quite what this means but you can do things to make sure that you take your business forward to the new landscape.

So yesterday for me was a day reflecting on the economy.  Firstly with a client as we went through their 2011/12 Marketing Plan and looked at the implications for their business on the research we had carried out for them.  Then it was with my chamber hat I reflected on the economy and what it means for the UK and the small part of the world that I live and work in.  Finally it was at home reflecting on our day’s we wondered yet again what does the economy mean, as I said at the start, for our businesses, our clients and for us personally.  Like everyone we don’t really know.  But what we do know is that we want to take our own businesses forward, assist in building that of our client’s and building up our little family to learn that by hard work and commitment you can achieve a great deal.

So if you have come on my blog today to read about my thoughts on the Apprentice sorry that will come tomorrow.  I intend to watch it tonight instead of my usual Thursday night telly of Three in a bed.  (yes another programme I watch to look at consumers).  And tomorrow I will add an Apprentice blog.  But hope this muse on the economy has been of interest and again interested in views.  What do you think the future holds?

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About fionadranesblog

40 plus mum of two married with a mad cocker spaniel. Along with two colleagues run Bright Light Marketing a rural marketing agency who specialise in getting rural businesss noticed. www.brightlightmarketing.co.uk. Live in St Boswells in the wonderful Scottish Borders. Love books, walking and living life to the full here in the Scottish Borders though its sometimes a juggle!
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2 Responses to What’s going on with the UK economy?

  1. barbara foulkes says:

    Hi Fiona, first time I have read this blog, in fact first blog I have read, still a bit of techno idiot, just want to say I could not agree more. We too have changed our spending habits, and will not return to spend spend spend.
    In tourism terms it is all about value for money and those who have provided this and continue to do are doing well. The others who have taken easy money without providing the service are finding the chill wind and this will continue until they understand the new market conditions.

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