Money greases the wheels of our consumerist society. Without this continual flow of finance the economy contracts and many people lose their livelihoods, especially in retail.
It is completely natural, and prudent, to want to save in periods of uncertainty. Talk of entering the worst recession for over 300 years would make even the most optimistic of people think twice about a big purchase or being frivolous with their cash.
COVID 19 has been a tale of two working economies; those, generally, white collar workers working from home, whose wages weren’t affected, saving money on travel and lunches, and those reliant on these workers being made redundant or having their hours reduced. Many workers on furlough have been in an economic form of limbo, and while they have not seen most of their income disappear, this is quickly coming to an end and some will be made redundant. Many of these jobs will not be deemed ‘viable’ in the short term.
Left - Results of website loveMONEY poll
A small poll by the website loveMONEY, in June, found readers say their finances have actually improved under lockdown. A remarkable 23% said they were significantly better off, while the biggest amount, 36%, said things had improved slightly.
At the other end of the scale, 13%, more than one in eight, reported that their finances had been hammered since the lockdown came into effect, while a similar percentage (14%) said they were slightly worse off. Finally, 14% of respondents said their bank balance looked largely the same at the end of each month.
The vast majority of people spent less during lockdown because they had less things to spend money on and most not leaving the house.
According to a study by AA Financial Services, 85% of UK adults spent less during lockdown. The average Brit saved (per month) £49 a month on petrol, £57 by not going to pubs or restaurants, £53 by not going to shops, and significant savings in other areas, totalling £617 a month on average for those still receiving their full income.
The report also found that 31% of people with savings accounts had increased their monthly deposits since the start of lockdown. This was confirmed by Bank of England data, which found that personal bank deposits had grown by three times the recent average. The Bank revealed that consumer debt was down by £7.4 billion, to just half the level seen in February. Those who are benefiting from excess income are in many cases using their spare money to pay down debts, while choosing not to take out new loans due to increased uncertainty.
According to Aviva, women seem to have been affected more strongly with 38% of women vs 29% of men saying they have less money to spare at the end of the month than they did pre-lockdown. This could be due to the types of jobs women do, like part time and in customer-facing roles.
Young adults have also been hit hard. Almost a third of 25- to 34-year-olds (32%) are concerned about their ability to save. This age group is also the most worried about losing their job due the impact of COVID-19 (28%).
Aviva Head of Savings and Retirement Alistair McQueen says: “Female savers look to have been disproportionately affected during the lockdown, as workers in sectors like hospitality and retail are more likely to be younger females. Younger people across the board also face a significant challenge. Those under 34 typically struggle to save under normal circumstances, but the current conditions have exacerbated this. For example, this age group typically spends a greater proportion of their budget on housing, and bills, which remains unchanged.”
In August, there was a big government push to get white collar workers back to the office. Then a recent u-turn, telling people to work from home again with positive COVID 19 cases rising. Many commuters don’t want to go back to that lifestyle and it’s easy to understand why.
DJ Sinfield @BigSino on Twitter said, “I am WORKING from home. I am saving £500+ a month and getting an extra 3 hours a day family time. This money and time is being spent at farm shops, local butchers etc and not Southeastern Trains. Why would I want to go back to commuting? Why?”
John Bye @_johnbye said, “The fact is many of us have enjoyed working from home, and companies have realised they're wasting money on big offices they don't really need. I save £300 a month and 2.5 hours a day by not commuting. Why would I want to go back to a London office full time?” and Paul Chapman @Paul_C-Chapman said, “I am saving around £30/day on rail fares and food, I have 3 hours/day of my life back, I have a much better work/life balance and my health is better. Why on earth would I want to go back to daily commuting?”
With interest rates dropping like a stone for savings, for example, the government backed NS&I just reduced its ‘Income Bond’ from a paltry 1.16% to an almost zero 0.01%, the incentive to save has been reduced. What we need is people to spend our way into a U shaped recovery. We need the people, on the positive side of the COVID recession, with this additional monthly money, to spend it.
This is a call to arms for work-from-homers to spend. It’s not about people spend their savings, it is also not about people spending more money than they would usually, it’s about those with this worker windfall - what they would have otherwise have spent on lunch and travel etc.- to inject that into the economy. It’s tempting to save it, but it’s money they wouldn’t have had on a monthly basis.
Put it into retail and services worth supporting, and retailers and brands they don’t want to see disappear and are rewarded with their custom. This isn’t about lazily rewarding shops or travel companies that aren’t very good or really are past their peak, it’s about supporting new or established businesses which resonate with you and make or provide great services or products.
It could be ethical or green products or services. It could be new business, crowd funding and start-ups. Look at it like an investment in the future you want to see. It’s time to put this bonus money to good use.
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News in, Jigsaw is closing its Bluebird concept. After 15 years, the majority of those spent at the quiet end of the Kings Road in Chelsea, it recently moved more central to the prime site of the refurbished ‘Carriage Hall’ on Covent Garden’s Floral Street.
Left - Inside Jigsaw's Shop At Bluebird, Carriage Hall, Floral Street closing this week
Named after the art-deco car garage it was once housed in, it relocated in May 2018 and was part of the landlord Capco’s relaunch of Floral Street alongside the first central London outpost of Petersham Nurseries.
Stocking a mix of designer labels and maison objets, after just over 18 months in this location, The Shop at Bluebird, to give it its full title, is closing its doors for good this week.
A concept store without a concept, its short spell on Floral Street clearly illustrates how a once thriving, premium fashion street in a central location is struggling to pull in the shoppers. The store will turn into a larger Jigsaw store format.
Right - Discrete sign advertising the brands on Floral Street
Floral Street, a charming cobbled street just off the busy James Street, has been a fashion destination since the late 1970s. A pioneer of the area, Paul Smith opened his first store in London at 44 Floral Street in 1979. Over the next 20 years, Floral Street became one of the coolest fashion streets in London. Agnès B, Nicole Farhi, Jones, a cult designer menswear retailer, and Jigsaw Menswear were just some of the stores to make this street blossom. It’s slightly off-the-main-drag location was part of its charm.
Today, many tourists and shoppers walk straight past to the busy market area with its plethora of beauty brands or upwards to the more high-street Long Acre. Peer down Floral Street and it doesn’t look like much is there.
Floral Street isn’t alone, the same thing has happened to South Molton Street in Mayfair. On a map they geographically look as central and in the mix as anything else, but they, seemingly, get so easily passed by. Since the millennium these streets have gradually lost their appeal and declined.
Even Browns, the main pull of South Molton Street is moving. It has occupied its collection of small stores since 1970 and is now moving out. Running from Bond Street Tube station, on the corner of Oxford Street, diagonally down towards Brook Street, South Molton Street has long been a stylish cut through. Today, it has become more synonymous with people giving out free mini samples of soap than chic retail destination.
Browns is closing its collection of awkward stores to move around to a new, singular location on Brook Street. Now owned by online giant Farfetch, Brown’s new store will open this summer in time to celebrate its 50th anniversary.
While not being able to comment on the reason they are moving out, Holli Rogers, CEO of Browns and CFO of Farfetch, says “it really is telling that we found this incredible location to be our new home as we also look to celebrate our 50th anniversary. It was important that we stayed in the heart of Mayfair bringing our clients on this exciting journey, whilst honouring the path we’ve been on and looking to the future of Browns as a pioneer of luxury multi-brand retail with a technology viewpoint. Being in one dedicated space, we are excited to be able to offer a vital and engaging customer experience that draws on the store of the future technology whilst also playing homage to the history and story of both the location and fundamentally Browns.”
Left - Paul Smith's original London shop opened in 1979
So what will become of South Molton Street as even more empty shops pile up? Landlord Grosvenor is proposing investment in a ‘South Molton Triangle’ as the delayed Elizabeth Line finally opens in summer 2021 bringing many hundreds of thousands of more people into the area. But, they’ll need to entice them to venture down South Molton Street and not lose them to Oxford Street.
Right - Landlord advertising Kent & Curwen's Floral Street on the busier James Street
Bounded by Davies Street, Brook Street and South Molton Street and well-known as the home of Grays Antiques Market, this part of Mayfair was always a pedestrianised break from busy Oxford Street.
Grosvenor launched a public consultation in the summer of 2018, no doubt expecting the new underground station and line to be finished sooner. Simon Harding-Roots, executive director, Grosvenor Britain and Ireland, said at the time, “Our proposals are at a very early stage and we want to encourage feedback on how new investment could best serve the community above and beyond the opportunity to better manage increased pedestrian numbers. It is important to us that local voices are incorporated into the planning submission we will ultimately make.”
“The West End is currently ill-equipped to cope with the levels of pedestrian traffic we already see every day, let alone the arrival of thousands of extra visitors expected from the Elizabeth Line. Many of Mayfair’s pavements are too narrow, routes were built for a different era and, perhaps counter intuitively, there are not enough services for those living in and visiting the area.
“We recognise the potential of the South Molton Triangle to address a number of the issues the local community faces. By proposing new investment here, we will be able to better protect and enhance the character and simple enjoyment of living and working in one of the most desirable places in London and the West End.”
Right - Glossier beauty pop-up open until February 9th
These areas need more than simply people management, new pavements and street furniture and it feels like landlords, Capco and Grosvenor, have been focusing on larger and juicer parts of their estates rather than these streets which are more on a Victorian and Georgian scale. At the same time streets like Chiltern Street and areas like Coal Drops Yard have developed and are doing what these locations used to do.
The American beauty brand Glossier recently opened a pop-up on Floral Street, open until February 9th, 2020.
These forgotten about fashion streets were once a destination for those looking for the new cool. Being surrounded by hugely popular shopping areas, there is no reason why they can’t return to this.
These streets need to find a new reason to be and then channel people accordingly. They need to work out and provide what is cool in 2020.
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