Thousands of households will pay more for trees this Christmas compared with the previous year as firms take advantage of rising costs, experts say.
The price of mince pies and cups of mulled wine has gone up and many retailers are predicting a boost in sales as shoppers follow cheaper stores, such as Aldi and Lidl, which reported double-digit sales increases last week.
Expect to pay more for Christmas trees, experts say Read more
The cost of Christmas trees, including decorations, will rise by 3%-5% over this year, bringing the average price to £25-30, according to the British Christmas Tree Growers.
And it’s not just mince pies and coffee which may be more expensive: party cake suppliers are also facing higher costs as ingredients such as flour, milk and eggs are at a premium.
Ephraim Tukes, a farm researcher at the British Christmas Tree Growers, said: “Whilst demand for Christmas trees continues to rise, the cost of this product is increasing in line with the cost of food imports, at a time when many regions of the country are facing considerable economic uncertainty.
“The projected increase in demand for Christmas trees across the country during the Christmas season is expected to help to alleviate some of the supply issues on offer, but industry partners and suppliers will undoubtedly be keen to pass on increased costs to consumers as much as possible.”
Extra sales are forecast in the run-up to Christmas as shoppers follow cheaper stores, such as Aldi and Lidl, which reported double-digit sales increases last week. In June last year, Co-op started selling Aldi mince pies at its UK stores after launching them in a store in Sheffield in May.
“Christmas stalls selling mince pies have sold out of Aldi and Lidl products at about 60% more than they were hoping for,” said Ann-Marie Caygill, retail director of Aldi in the UK. “Customers love bargain prices and this is great news for everyone.”
Dan Sellens, retail expert and manager of KPMG retail consulting, said there is strong demand for cheaper food such as mince pies: “The Christmas Party season is the perfect time for people to munch on a Greggs Pasty to help them wrap up on a freezing evening.”
Retail analyst Joshua Bamfield said the trend was “absolutely sustainable”, but warned there was a risk that there would be some stampede among shoppers: “It’s definitely been proving a winner. Last week, Aldi had particularly good mince pie sales, which suggests there was quite a lot of impulse buying on Black Friday weekend.
“However, it’s very difficult to determine what’s driving those numbers, there are all sorts of reasons behind it. I wouldn’t be concerned, but you do sometimes get the stampede when things get too good to be true.”
But Bamfield said he believed the rise in costs for Christmas trees and other festive products, such as party cakes, would moderate. “It’s more about what is happening in the market place than people are just buying value for money.”