Retail Memo: Bloody Recession Be Damned - Upscale, Premium UK Supermarket Chain Waitrose Reports Record Sales For the Day Before Christmas

Bloody recession be damned -- it's Christmas.

The sentiment above appears to be what was on the minds of tens of thousands of British consumers who flocked to the United Kingdom's most upscale and premium-oriented supermarket chain, Waitrose, on the days leading up to Christmas, December 25.

And December 23, Christmas Eve, was the biggest day of all. In fact, it was the biggest day in history for upscale Waitrose [Web site: Waitrose.com.]

The specialty, premium, gourmet, fresh-prepared and natural foods-focused supermarket chain, which is owned by Britain's John Lewis Partnership, took in £34.4m from more than 879,000 transactions on December 23, beating the previous record of 754,000 set in December 2006, the company reported this week. Waitrose is a full-service general format supermarket in addition to its upscale focus.

Waitrose says it benefited from a "late shopping surge" in the last three days before Christmas, which resulted in a 12% rise in same store sales for the chain.

On Christmas eve, sales were 5% over Christmas Eve 2007, while in the week leading up to Christmas, same store growth was 3.5%, according to Waitrose managing director (CEO) Mark Price.

Chief executive Price says shoppers were filling their carts with Christmas holiday foods, along with buying lots of specialty foods items as gifts.

Waitrose tossed out some numbers regarding item sales during the week leading up to Christmas: It says it sold 231,000 fresh and frozen turkeys, 350 tons of British cooked meats, over 12 million mince pies and millions of boxes of chocolates.

It appears that despite the very severe economic recession in the UK, thousands of consumers decided to spend their money on a traditional Christmas when it came to food.

Our analysis, and this holds for our observations in the U.S. as well, is that numerous consumers decided that instead of spending the amounts of money they normally have in previous years on Christmas presents -- clothing, electronics, toys and the like -- that this year they would spend much less on such gift items, but spend more on food, as well as purchase more food items as gifts.

The percentage decreases among department, toy and other gift-oriented stores in both the UK and U.S. bare out our analysis, we believe. In contrast, numerous supermarket chains, including upscale grocers such as Waitrose in the UK and similar format retailers in the U.S., are reporting very strong Christmas holiday sales in their stores.

Additionally, it appears to us that many consumers who might traditionally have had Christmas dinner out at a restaurant (holiday restaurant sales in both the UK and the U.S. were down over last year) or travel away from the home for the holiday (hotel bookings were down considerably for Christmas this year), stayed home, and dined at home, thus leading them to spend more money at the supermarket, including on fancy holiday foods -- money they saved by not dining out or staying home rather than going away for the holiday; or both.

Green Memo: The Ban-The-Bulb Movement

Greenpeace UK calling on Ireland to ban the incandescent light bulb

The international movement to ban the sale of incandescent light bulbs is currently in its infancy. However, beginning in 2008, we believe the movement will pick up steam, joining plastic grocery bag bans as a major green campaign in the west.

As our readers know, we've been following closely the growing international movement by municipalities, states and provinces to ban plastic grocery bags. You can read our latest piece on plastic bag bans here.

We believe another ban movement is beginning, and that it will start to pick up steam next year. This movement will be advocating bans on the selling of incandescent light bulbs.

We see this ban taking many forms. First, we think there will be increased pressure put on retailers to stop selling incandescent light bulbs altogether, and to just offer compact fluorescent lamps (CFLs), which most already sell, for sale in their stores. Second, we believe on the governmental level, ban-the-bulb campaigns will be strongest first at the city or municipality levels, followed by states and provinces. Nationwide bans will come last, with some exceptions of course, such as the one discussed below.

One of the first major movements to ban incandescent light bulbs is beginning in Ireland. Greenpeace UK has launched a major online campaign and petition drive to get Ireland's environment minister, John Gormely, to author legislation to ban the incandescent bulb.

Greenpeace UK chose Ireland to start this campaign because the country uses more energy for lighting than any other country in the European Union (EU). Greenpeace UK wants the Irish government to pass a law which will set tough energy efficiency standards on household lighting.

The Irish government has already began a program to phase out incandescent light bulbs and has proposed an "eco-tax" on them in order to favor the use of CFLs Greenpeace supports the tax but says its not enough. Rather, they want the government to implement a law which insists on mandatory, ever-improving efficiency standards for household lighting. Such standards would make the incandescent bulb a thing of the past, they say.

You can read more about the Greenpeace UK proposal here, as well as see the online petition to the Irish government. Thus far 8,634 people have signed the petition. Greenpeace UK's goal is for 10,000 signatures.

Essentially, the group's plan isn't for the Irish government to pass a law that says outright that incandescent light bulbs can no longer be sold in the country. Rather, by passing its proposed lighting efficiency standards, which technologically incandescent bulbs can't meet, the old-school bulbs would just fade away.

In the UK there's currently a "voluntary" ban on incandescent bulbs in place. Bulbs with less than 30 lumens per watt could gradually disappear from the marketplace under the ban--but it is voluntary. A number of UK retailers have said they plan on completely eliminating the sale of incandescents in their stores. For example, the Woolworth's supermarket chain says it will stop selling incandescents by 2010. Additionally, the Co-op, a food retailer with numerous stores in the UK, has said it also will no longer sell incandescent bulbs after 2010.

Swedish furniture and household accessory retailer Ikea, which has stores in the UK and throughout the world, recently announced it will ban the sale of incandescent bulbs in all its stores worldwide by 2011.

Greenpeace UK is lobbying every major retailer that sells incandescent light bulbs in the UK, and tracking their response to the voluntary ban. Thus far one retailer, Currys, says it will stop selling incandescents by the end of this year.

Another UK retailer, Habitat, has committed to eliminating the bulbs from its shelves by the end of 2009. In Addition to Woolworths and the Co-op, other major retailers who say they will stop selling incandescents by the end of 2010 include, ASDA, Sainsburys and Morrisons. Sainsburys is the UK's number one retailer. ASDA is owned by Wal-Mart.

Tesco, the UK's number two retailer, and Waitrose, the leading upscale grocer in the UK, have committed to banning the incandescent bulbs from their shelves by the end of 2011. You can read a list, and time-line, of UK retailers who've thus far agreed to stop selling incandescents here.

The move to ban incandescent bulbs also is picking up steam elsewhere in the EU, but not yet to the degree it has in the UK and Ireland. The movement also is starting to develop in the U.S. Cities such as San Francisco, which is the first U.S. city to ban plastic grocery bags, and a few others are considering legislation regarding household lighting efficiency standards and possible incandescent bulb bans.

Groups also are beginning to put pressure on major U.S. retailers like Wal-Mart, the world's largest retailer, to stop selling the bulbs. Earlier this year Wal-Mart came out with its own private label CFL, which it's selling in some cases for as little as 99 cents each.

We expect to see the movement gain major traction in the U.S. next year however as Green Peace and other groups begin to focus more on retailers, like they are in the UK, and as more cities look at local legislation. In the U.S., such environmental legislation generally starts at the local level, then moves to the states and federal government after.

We also expect to see some progressive retailers stop selling the incandescent bulbs on their own. Major U.S. retailers like Home Depot and Lowe's already devote very little shelf space to incandescents relative to the amount of space they now are devoting to CFLs. Further, public utilities systems in the U.S. are offering rebates on the purchase of CFLs by consumers. These rebates bring the price of CFLs down to that of incandescents, and are resulting in huge sales increases in the CFL category.

This is an issue that, like plastic grocery bag bans, is going to grow rapidly internationally. We will be watching it closely and reporting on it regularly for our readers.