Deloitte

SOUTH WEST BUSINESSES KEEPING A TIGHTER REIN ON FESTIVE SPENDING, ACCORDING TO DELOITTE SURVEY

The spirit of Christmas may be on the wane among businesses in the South West this year, according to a new survey.

The latest monthly survey from leading business advisory firm Deloitte, reveals that more employers are sticking to the traditional Christmas holiday break, and that there is slightly less bonhomie in other areas compared with previous years.

But the number of companies that have decided they want to share the celebrations with clients and staff are doing just that – and on a larger scale.

Denis Woulfe, Senior Practice Partner at Deloitte in Bristol, said it was too early to say that issues such as the global credit crunch had impacted on this year‘s festivities.

He commented: “I do think, however, that this is an indication that businesses are increasingly looking to scrutinise budgets ever more closely in the expectation that the economy may slow down next year.”

THE CHRISTMAS BREAK

Half of the Deloitte survey respondents are this year planning to close purely for the traditional Christmas Day, Boxing Day and New Year‘s Day breaks. This compares to fewer than a third last Christmas.

About three in five (61 per cent) said the decision had been governed by client and customer considerations while others made their plans with their staff in mind.

Almost half (46 per cent) of companies said that business had now gone too far in closing for an extended period over Christmas.

“Decisions on whether to shut down or work on days other than the traditional holiday vary enormously and also depend on what days the key dates fall on,” said Denis Woulfe.

CHRISTMAS BONUSES

There is a wide variation when it comes to company expenditure on bonuses, parties, gifts, cards and other seasonal items, according to the latest Deloitte survey.

A figure of up to £500 was quoted by 7 per cent of firms with most of the remainder saying they would spend between £500 and £10,000. Exactly a quarter of companies said they would be parting with more than £10,000 to make sure the festivities went with a bang this year.

Meanwhile the number of companies paying a seasonal bonus has dipped from 26 per cent to 11 per cent with almost three-quarters (71 per cent) of those rewarding their staff paying the same amount as last year. No company said they were increasing the level of their bonus and 3 per cent are actually paying less.

THE CHRISTMAS PARTY

The traditional staff get together remains on the calendar for about the same number of businesses as last year – around 70 per cent.

A larger budget is being made available by 14 per cent, 11 per cent are spending less and the remainder are sticking to last year‘s levels.

Fears about allowing the parties to be held on company premises are still dominant but the extremely high levels of concern have eased slightly.

More than 80 per cent – with an eye on health and safety and potential claims – will again be issuing guidelines to managers concerning costs and behaviour but while not a single business said they would permit their own site to act as host last year, 7 per cent are giving the go-ahead for 2007.

CHRISTMAS GIFTS

There is a fall this year in the number of firms arranging Christmas gifts for their clients and customers – down from 38 per cent to 25 per cent. Two years ago the figure stood at 40 per cent.

The most common outlay for businesses giving presents is between £5 and £20, although 7 per cent said the value would be more than £50.

Denis Woulfe said: “Spending patterns have not changed significantly but what movement there was suggested a more prudent approach by many businesses in the region.”

CHRISTMAS CARDS

Just over half (54 per cent) of panellists are sending corporate Christmas greetings this year, which represents a drop of 7 per cent on 2006, and there is a major fall in the total of traditional cards being sent out from 89 per cent to 46 per cent. More firms are using electronic cards – up from 11 per cent to 18 per cent.

There is a rise of more than 10 per cent in companies that think that these are a good environmentally friendly alternative but significant concern was also expressed about the impersonal nature of the messages and the possibility that they could be confused with “spam.”

The majority (68 per cent) said they recycled traditional cards they received while more than 40 per cent of those not sending cards, plan to make a donation to charity instead.

“Many companies want to retain the personal touch, which is understandable, but at the same time an encouraging number are keeping recycling at the forefront of their policies,” said Denis Woulfe.

THE “SCROOGE FACTOR”

Exactly half of the firms which took part in the survey have paid and arranged for decorations – 7 per cent down on last year – but special staff events have been organised by 68 per cent, up very slightly on last year.

Denis Woulfe said that this year‘s Christmas survey showed there was ample Christmas cheer in evidence among the region‘s business community.

“While there remains plenty of Christmas spirit around, we have found very little evidence of increased spending and some examples of some – albeit gentle – belt-tightening this time,” he concluded.

ENDS 19th December 2007

For further information please contact Neil Fraser, Sturgess Van Damme, on 01275 349011 or email neil@sturgessvandamme.co.uk