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                                                Retail Planner
                                             Briefing Note 6.0




                                                                October 2008
Retail Planner Briefing Note 6.0

October 2008

Contents

                                                                     Page

Introduction                                                                1

Key advantages of the Retail Planner service                                2

1      Estimating consumer spending on retail goods                         3

2      Estimating consumer spending on leisure services                     7

3      Projections and forecasts                                            8

4      Retail potential                                                     13

5      Non-store retail sales                                               16

6      Comparison with retail sales data                                    17

7      Price trends                                                         18

8      Changes in the efficiency of retail floor space                      20

9      Small area estimates                                                 30

10     Contact details                                                      32


Annex 1: Recent data and forecasts for values, volumes and prices
Annex 2: Classification of individual consumption by purpose (COICOP-HBS)
Introduction


Retail Planner is a service for retail planners, property consultants and retailers, providing
comprehensive, up-to-date and credible information for retail planning decisions.

This briefing note describes and explains trends and forecasts in expenditure on retail goods,
leisure services, retail potential and changes in the efficiency of retail floor space.



Contacts
Bureau service

Email:                   goad.sales@uk.experian.com
Telephone:               0845 6016011


Sales enquiries

Simon Sharpe             simon.c.sharpe@uk.experian.com
                         0115 968 5580




Technical queries

Sunita Bali              sunita.bali @uk.experian.com
                         0203 042 4713

Stephen Adams            stephen.adams@uk.experian.com
                         0207 746 8219
Key advantages of the Retail Planner
service
    Retail Planner uses Mosaic - the world’s most heavily used customer segmentation
     system - to determine the relative affluence and spending characteristics of each
     postcode in the country. Mosaic reflects rich sources of local-level information,
     including the results from Experian’s own annual survey of 1.5m households. No other
     provider has access to this information. The quality of the data on spending by locality
     and household within Retail Planner is, therefore, both unique and market leading.

    Experian ensures that Retail Planner always reflects the most up-to-date information.
     Retail Planner’s estimates of population by small area (Ward, Postal Sector and Output
     Areas) include information from the 2001 Census and more recent mid-year estimates.
     Consequently, if other data sets are used, Retail Planner clients will often be able to
     highlight errors that are generated through the use of population estimates that have
     gone past their ‘use-by date’.

    Unlike expenditure estimates from other sources, the data in Retail Planner only include
     true retail activities. Unlike many competitors, we use insights from official information
     to ensure that non-retail purchases (such as plumbing services) are excluded from our
     expenditure estimates. Consequently, Retail Planner clients can be confident at enquiry
     that their data is built on sound foundations.

    Retail Planner uses COICOP, the industry standard for postcode-level population
     estimates, to help build datasets for small areas. Some other providers do not use this
     source and consequently may not build accurate small area datasets for their clients.

    Spending propensities, analysed by household type and location, used in Retail Planner
     reflect the latest edition of Family Spending (2008), which reports on the 2006/07
     Family Expenditure Survey. So our local area spending estimates incorporate the latest
     information on changes in consumer tastes and spending habits.

    Retail Planner is backed up by the Retail Planner Briefing Note which provides the
     latest thinking on key issues for users – trends in spending growth, e-tailing and sales
     densities.
1. Estimating consumer spending on
   retail goods


1.1       SOURCES

Estimates of consumer spending on retail items are taken from estimates of household spending
contained in the ONS (Office for National Statistics) publication Consumer Trends (latest issue
March 2008).1 This breaks total household spending down according to the internationally
recognised COICOP categories (Classification of Individual Consumption by Purpose). This is
consistent with the definitions used in the ONS National Accounts (Blue Book, June 2007)
publication.

Note that these estimates are based on surveys of consumers and are not the same as the ONS
estimates of retail sales, which are based on surveys of shops and businesses. The difference
between the two estimates is discussed in Section 1.3 below and in more detail in Section 5.

1.2       DEFINITIONS

In Retail Planner, consumer spending on retail goods is available at either a ‘fine’ or ‘coarse’
level of detail.2 Forecasts and market share estimates (see Sections 2 and 4) are only provided at
a coarse level. The coarse categories are aggregations of the fine categories and are detailed in
Table 1.1. Other special aggregations are also available, such as ‘comparison goods’,
‘convenience goods’, ‘core DIY goods’ and ‘core bulky goods’ (see Section 1.5 below).

1.3       ALLOWANCE FOR NON-RETAIL SPENDING

In all cases but one, spending estimates refer to retail outlets.3 The exception is tobacco, where
the figures include spending in pubs, clubs and restaurants. We allow for this non-retail
spending and for tobacco which is smuggled into the country. Estimates are based on data from
the Annual Business Inquiry (ABI).

1.4       ALLOWANCES FOR SPENDING MADE BY FOREIGNERS

The National Accounts definition of household outlays includes spending in the UK by
foreigners.4 This is deducted from the sum of spending by category (which also net off UK
residents spending abroad) to give the figure for total household spending by UK residents that
appears in the National Accounts and the ONS’ GDP releases.

In 2007, the ONS estimated that foreigners spend £19.1bn pounds in the UK out of total
household spending in the UK of £769bn (2.5 per cent of the total). The bulk is used for
accommodation, catering and travel services, but, on the basis of Input-Output tables and the
International Passenger Survey, we estimate that some 25 per cent of this is spent on retail


1
  The ONS now refers to consumer spending as household spending.
2
  Note that this does not represent the full level of detailed spending estimates available from Experian, but it is the
most detailed level for which ONS currently publishes national spending totals (in Consumer Trends and the Blue
Book).
3
  This includes spending in such non-retail outlets as mail order and sales by wholly internet companies.
4
  European System of Accounts 1995 (or ESA95). Note that this was also the case with previous definitions of
consumer spending.
goods. Table 1.1 shows this estimate broken down by coarse category and Table 1.2 shows the
full, fine category detail.

While this is genuine spending, most of which finds its way into UK retail outlets (rather than
into special forms of trading), we have separated it out from the resident totals. This is because
most spending by foreigners takes place around tourist centres and cannot be allocated to small
areas on the basis of population and socio-economic mix as for residents.5

Note that the current version of Retail Planner covers spending by residents in the UK. It does
not include any estimates of retail spend by tourists in local areas, although information on this
is planned for future versions.

1.5      AGGREGATIONS

Aside from COICOP, Retail Planner contains a number of special aggregations of retail goods.
These are:

      1. Convenience goods – low-cost, everyday items that consumers are unlikely to travel far
         to purchase. Defined as food and non-alcoholic drinks, tobacco, alcohol, newspapers
         and 90 per cent of non-durable household goods.6
      2. Comparison goods – all other retail goods.
      3. Core DIY goods – goods that might be sold in a DIY store. These are defined to be:
              a. Materials for repair and maintenance of the dwelling.
              b. Small tools and miscellaneous accessories.
              c. Major tools and equipment.
              d. Gardens, plants and flowers.
              e. Furniture and floor coverings (10 per cent of total sales).
              f.   Non-durable household goods (10 per cent of total sales).
          There is also a category called core DIY goods excluding gardening.
      4. Bulky goods – defined as:
              a. DIY goods (as above).
              b. Furniture and floor coverings (remaining 90 per cent of sales).
              c. Major household appliances whether electric or not.
              d. Audio-visual equipment.

1.6      NHS PRESCRIPTION COSTS

Official estimates of household spending include the cost of prescription charges but not the
cost of the subsidy paid by the NHS. This means that household spending on medical goods will
understate the potential sales of pharmacists. To allow for this shortcoming we have estimated,
based on NHS data, that spending by the NHS on prescriptions was £168 per person in 2007.


5
  In 2004 almost half of all spending in the UK by overseas tourists took place in London (International Passenger
Survey).
6
  Non-durable household goods comprise cleaning materials, kitchen disposables, household hardware and
appliances, kitchen gloves, cloths etc and pins, needles, tape measures and nuts and bolts. We have assumed, based
on EFS data, that 10 per cent of non-durable household goods are DIY-type goods and, therefore, are properly
classified as comparison goods while the remaining 90 per cent have the characteristics of convenience goods.
1.7          ESTIMATED SPENDING ON RETAIL GOODS IN 2007

Tables 1.1 and 1.2 show spending estimates for coarse and fine expenditure categories in the
latest full year (2007).

                                          TABLE 1.1
              ESTIMATES OF SPENDING ON RETAIL GOODS IN 2007 – COARSE CATEGORIES

                                                                                                 Total    Spend by        UK res.   UK spend
COICOP                    Description                                                     spending £m    foreigners   spend in UK    per head
1                         Food and non-alcoholic beverages                                     76,503           895       75,608        1,248
2.2                       Tobacco                                                              16,642           115         9,751         161
2.1                       Alcohol (off trade)                                                  13,140           100       13,040          215
9.5.2                     Newspapers and periodicals                                             4,423           34         4,389          72

3.1.1, 3.1.2, 3.1.3       Clothing materials & garments                                        41,121        2,495        38,626         638
3.2.1                     Shoes and other footwear                                              5,914          332         5,582          92
4.3.1                     Materials for maintenance & repair of the dwelling                    7,323           27         7,296         120
5.1.1, 5.1.2              Furniture and furnishings; carpets & other floor coverings           18,967           86        18,881         312
5.2                       Household textiles                                                    5,709           27         5,682          94
5.3.1                     Major household appliances whether electric or not                    5,052           59         4,993          82
5.3.2                     Small electric household appliances                                     566           48           518           9
5.5.1, 5.5.2              Tools and miscellaneous accessories                                   3,913            5         3,908          65
5.4                       Glassware, tableware and household utensils                           4,989           14         4,975          82
5.6.1                     Non-durable household goods                                           3,652          110         3,542          58
6.1.1, 6.1.2              Medical goods & other pharmaceutical products                         3,876           34         3,842          63
6.1.3                     Therapeutic appliances and equipment                                  3,343            0         3,343          55
7.1.3                     Bicycles                                                              1,421           32         1,389          23
9.1.4                     Recording media                                                       7,726           17         7,709         127
9.2.2, 9.3.1, 9.3.2       Games, toys & hobbies; sport & camping equip.; musical instr.        19,854           48        19,806         327
9.3.3                     Gardens, plants and flowers                                           3,903            0         3,903          64
9.3.4                     Pets and related products                                             2,727            0         2,727          45
9.5.1, 9.5.3, 9.5.4       Books & stationary                                                    7,173           17         7,156         118
8.2,9.1.1, 9.1.2, 9.1.3   Audio-visual, photographic & info processing equip.                  15,514           70        15,444         255
12.1.2, 12.1.3            Appliances for personal care                                         16,827           65        16,762         277
12.3.1                    Jewellery, clocks and watches                                         4,532           34         4,498          74
12.3.2                    Other personal effects                                                2,363            5         2,358          39

                          Total convenience                                                   113,995        1,243       105,976       1,749
                          Total comparison                                                    183,178        3,426       179,752       2,967
                          Total retail                                                        297,173        4,669       285,728       4,716
                                    TABLE 1.2
          ESTIMATES OF SPENDING ON RETAIL GOODS IN 2007 – FINE CATEGORIES
                                                                         Total    Spend by        UK res.   UK spend
COICOP                                              Description   spending £m    foreigners   spend in UK    per head
01.1.1      Bread and cereals                                          10,750           126       10,624          175
01.1.2      Meat                                                       15,105           177       14,928          246
01.1.3      Fish                                                         3,341           39         3,302          54
01.1.4      Milk, cheese and eggs                                        8,998          105         8,893         147
01.1.5      Oils and fats                                                1,499           18         1,481          24
01.1.6      Fruit                                                        5,678           66         5,612          93
01.1.7      Vegetables                                                 10,428           122       10,306          170
01.1.8      Sugar, confectionery and ice cream                           8,174           96         8,078         133
01.1.9      Other food                                                   1,891           22         1,869          31
01.2.1      Coffee, tea and cocoa                                        1,891           22         1,869          31
01.2.2      Fruit and vegetable juices and other soft drinks             7,409           87         7,322         121
02.2        Tobacco                                                    16,642          115         9,751         161
02.1.1      Spirits (off trade)                                         3,491           25         3,466          57
02.1.2      Wine, cider & perry (off trade)                             6,647           50         6,597         109
0.2.1.3     Beer (off trade)                                            3,002           25         2,977          49
09.5.2      Newspapers and periodicals                                  4,423           34         4,389          72
03.1.1      Clothing materials                                            483           29           454           7
03.1.2      Garments                                                   39,269        2,383        36,886         609
03.1.3      Other articles of clothing & clothing accessories           1,369           83         1,286          21
03.2.1      Shoes and other footwear                                    5,914          332         5,582          92
04.3.1      Materials for maintenance & repair of the dwelling          7,323           27         7,296         120
05.1.1      Furniture and furnishings                                  14,629           66        14,563         240
05.1.2      Carpets and other floor coverings                           4,338           20         4,318          71
05.2        Household textiles                                          5,709           27         5,682          94
05.3.1      Major household appliances whether electric or not          5,052           59         4,993          82
05.3.2      Small electric household appliances                           566           48           518           9
05.5.2      Small tools and miscellaneous accessories                   3,470            4         3,466          57
05.4        Glassware, tableware and household utensils                 4,989           14         4,975          82
05.5.1      Major tools and equipment                                     433            1           432           7
05.6.1      Non-durable household goods                                 3,652          110         3,542          58
06.1.1      Pharmaceutical products                                     3,303           29         3,274          54
06.1.2      Other medical products                                        573            5           568           9
06.1.3      Therapeutic appliances and equipment                        3,343            0         3,343          55
07.1.3      Bicycles                                                    1,421           32         1,389          23
09.1.4      Recording media                                             7,726           17         7,709         127
09.1.3      Games, toys and hobbies                                    16,800           41        16,759         277
09.3.2      Equipment for sport, camping & open-air recreation          2,810            7         2,803          46
09.2.2      Musical instrumnts & maj durables fr indoor recrtn            244            1           243           4
09.3.3      Gardens, plants and flowers                                 3,903            0         3,903          64
09.3.4      Pets and related products                                   2,727            0         2,727          45
09.5.1      Books                                                       3,692            9         3,683          61
09.5.3      Miscellaneous printed matter                                1,225            0         1,225          20
09.5.4      Stationery and drawing materials                            2,256            5         2,251          37
09.1.1      Eqpt fr recptn, recrding & reprdtn of sound & pics          4,977           23         4,954          82
09.1.2      Photographic & cine eqpt & optical instruments              4,023           18         4,005          66
09.1.3      Information processing equipment                            5,536           25         5,511          91
08.2        Telephone and telefax equipment                               987            4           983          16
12.1.2      Electric appliances for personal care                       1,111            4         1,107          18
12.1.3      Other appliances, articles & prods fr personl care         15,716           61        15,655         258
12.3.1      Jewellery, clocks and watches                               4,532           34         4,498          74
12.3.2      Other personal effects                                      2,363            5         2,358          39
            Convenience                                               112,656        1,227       104,652       1,727
            Comparison                                                183,177        3,423       179,754       2,967
            Total Retail                                              295,833        4,650       284,406       4,694
2. Estimating consumer spending on
   leisure services

2.1      SOURCES, METHODS AND DEFINITIONS

Estimates of spending on leisure services are based on exactly the same sources and methods as
for retail goods (detailed in Section 1).

2.2      ALLOWANCES FOR SPENDING MADE BY FOREIGNERS

An allowance for the value of spending on leisure services by foreigners has been made in the
same way as for retail goods. Spending by foreigners accounts for a considerably larger share of
total spending on leisure services (8.8 per cent compared with 1.6 per cent for goods), largely
because of a relatively high spend on accommodation.

Note that leisure spending abroad is again an estimate based on information from the
International Passenger Survey and Input-Output tables. As spending in the UK is derived as a
residual, estimates are potentially subject to a wide margin of error in categories where spend
abroad is a large share of the total.

2.3      ESTIMATED SPENDING ON LEISURE SERVICES IN 2007

Table 2.1 shows estimates of spending on leisure services in 2007. UK residents’ spending is
dominated by the restaurants and cafes category (including pubs). We estimate this accounts for
about 60 per cent of total leisure spend and 6 per cent of total spending by UK residents at
home.
                 TABLE 2.1 ESTIMATES OF SPENDING ON LEISURE SERVICES IN 2007

                                                                     Total    Spend by    UK residents   UK spend
COICOP   Description                                          spending £m    foreigners   spend in UK     per head
                                                                               19095
9.4.1    Recreational and sporting services                        7,561          113          7,448          123
9.4.2    Cultural services                                        15,262          452         14,810          244
9.4.3    Games of chance                                           9,905            0          9,905          163
11.1.1   Restaurants, cafes etc                                   73,273        4,017         69,256        1,143
11.2     Accommodation services                                   14,338        6,492          7,846          130
12.1.1   Hairdressing salons & personal grooming estbshmnts        5,513           99          5,414           89

         Total                                                   125,852       11,172        114,680        1,893
3. Projections and forecasts

3.1       CONCEPTS

Future spending levels will have a critical bearing on the need for retail space. Consequently,
stakeholders in the planning process, such as the local authority, retailers, consultants and
surveyors, need to understand how spending on goods and services will change.

Traditionally, planners have used a mixture of methods to forecast spending levels. There is no
one correct method for the different considerations of each planning application. But experts
must decide which is best suited to the particular circumstance.

Retail Planner presents the two principle methods of looking at trends in spending on retail and
leisure goods:

     1    Projections – estimates based on the extrapolation of past trends, with alternative
          projections estimated over different time periods (say 5, 10, 20 and 40 years).
     2    Forecasts – estimates of future spending based on an econometric model of consumer
          spending. This approach also allows scenarios to be produced with different assumptions
          about the key macroeconomic drivers (such as interest rates).
The following sections describe the methodology used to forecast retail spending and the results
achieved, though we do not make value judgment about which is best.


3.2         CHAIN LINKING

Before we can estimate past trends in convenience and comparison goods spending, we need
historical time series. Traditionally this has involved aggregating ONS constant price (or
inflation adjusted) estimates of spending by detailed category. This is problematic because:

“Comparisons of aggregates of volume series over time are complicated by changes in the
relative prices of different goods and services and by qualitative changes in the goods and
services themselves. As time passes some goods escalate in price more rapidly than others.
Others change so much that they become, in effect, different goods and services from those
produced previously under the same name.”7

Because of these shifts, relative prices of goods and services in the base year become
increasingly unrepresentative over time. As a result, changes in measured volumes will also be
less reliable in periods distant from the base year. This is particularly problematic for goods or
services such as audio-visual equipment that have seen sharp declines in price over time. So,
valuing this spending at 2005 prices, when estimating aggregate retail spending growth rates
from, say, 1965 is likely to cause distortions.

Until 2003, the ONS approach used fixed-base chain linking, whereby estimates using different
price bases were spliced together every five years. In 2003, the ONS moved to annual chain-
linking for its constant price aggregates. This is similar to fixed-base chain linking except that
the weights change every year and growth over time is estimated by linking together year-to-
year estimates. This method is in line with the recommendations of the System for National

7
    National Statistics (1999), United Kingdom National Accounts, the Blue Book, p.25.
Accounts 1993 (SNA93), which is incorporated into the European System of Accounts 1995
(ESA95) and has been widely adopted internationally. The main drawback of annual chain
linking is a loss of additivity – as the components of, say, comparison spending only sum to
totals in the base year.

Since 2004, we have adopted the annual chain-linking methodology. This brings an additional
advantage in increasing the stability of retail spending growth, particularly for comparison
goods where changes in relative prices are most pronounced. This is largely because the volume
of spending on audio-visual equipment has been rising particularly rapidly in recent years,
accompanied by sharp falls in price. So comparison spending growth tends to fall relative to the
last estimate, as audio-visual equipment has a lower weight each time data is re-based and this
revision affects all previous years. This problem disappears with annual chain-linking.

Figure 3.1 shows how the estimated ultra long-term trend (25 years to 2003 in this example)
would have varied with different base years and compares it against the stability in the annual
chain-linked estimate. Using 1990 prices, for example, the fixed-base method gives an
estimated annual growth rate of 4.3 per cent a year, which is similar to the annual chain-linked
estimate. But the fixed-based estimate gives an estimate of 5.2 per cent per annum when
estimated at 1970 prices and a rate of 3.9 per cent per annum when estimated at 2003 prices.


                FIGURE 3.1: COMPARISON GOODS ULTRA LONG-TERM TREND:
                         FIXED BASED VS. ANNUAL CHAIN LINKING

                5.5

                5.0

                4.5

                4.0

                3.5

                3.0
                      1965    1970   1975   1980   1985   1990   1995      2000   2003
               Base Year ->
                                      Fixed Base     Annual Chain Linked



National Accounts currently use annual chain linking to 2003 and a fixed-base methodology
from 2004 onwards, with volumes being presented in 2003 prices. Retail Planner has adopted a
slightly different convention, with annual chain linking for every year to the latest data point
and volumes in 2006 prices. We believe it is useful to have spending volumes based in the
closest year possible to current prices.

The annual chain-linked data has been used to estimate past trends for the broad aggregates and
for projections. Forecasts have been prepared at a more detailed level and aggregated up to the
broad totals using annual chain linking. Note the lack of additivity means spending on retail
goods no longer equals the sum of convenience and comparison spend except in the base year,
although the discrepancies tend to be small.
    3.3      PROJECTIONS

    We have estimated trends in spending per head on retail goods using the following equation:

                                          ln( Spendt )    ut
    where:
    Δln(Spendt)               is the annual change in the log of spending per head.
    β                         is the estimated annual growth rate.

    This method has been used to estimate trends over the following time periods:
        1. 1967-2007 – ultra long-term trend
        2. 1977-2007 – long-term trend
        3. 1987-2007 – medium-term trend

    Tables 3.1 and 3.2 show projections and forecasts of future spending volume growth by broad
    retail headings.

    Results summary:

          Projections for future spending based on the medium-term (20-year) trend show the
           highest rates, reflecting the surge in retail expenditure during the 1980s and 1990s.
          Total retail spending growth over the next ten years is projected to be 2.1 per cent per
           person a year.
          Spending on comparison goods over the next ten years is projected to grow by 3.2 per
           cent a year, with projections of convenience spending growth of about 0.2 per cent a year.


                                       TABLE 3.1
     FORECASTS & PROJECTIONS OF UK SPENDING PER HEAD VOLUMES 2008-2012 (2006 PRICES)
                             Experian  Consensus    Ultra long- Long-term Medium-term
                             forecast    forecast   term trend    trend         trend
Convenience                     0.3         0.2         0.7       0.8           1.1
Comparison                      3.7         3.6         4.8       5.2           6.1
Total retail                    2.4         2.3         2.8       3.3           4.0
Core DIY                        1.4         1.3         3.0       3.5           3.4
Core DIY excluding gardening    1.8         1.6         2.9       3.6           3.2
Bulky goods                     4.5         4.3         5.4       6.0           6.8
Non-bulky goods*                3.4         3.3         4.3       4.9           5.8
Leisure services                1.0         0.9         2.4       1.8           2.0
Total consumer spending         1.6         1.5         2.4       2.5           2.8

                                       TABLE 3.2
     FORECASTS & PROJECTIONS OF UK SPENDING PER HEAD VOLUMES 2008-2016 (2006 PRICES)
                             Experian  Consensus    Ultra long- Long-term Medium-term
                             forecast    forecast   term trend    trend         trend
Convenience                     0.2         0.2         0.7       0.8           1.1
Comparison                      3.2         3.2         4.6       5.2           6.1
Total retail                    2.1         2.1         2.8       3.3           4.0
Core DIY                        1.6         1.6         3.0       3.5           3.4
Core DIY excluding gardening    1.9         1.9         2.9       3.6           3.2
Bulky goods                     3.8         3.8         5.4       6.0           6.8
Non-bulky goods*                2.9         2.9         4.3       4.9           5.8
Leisure services                0.8         0.8         2.4       1.8           2.0
Total consumer spending         1.6         1.6         2.4       2.5           2.8
    * Comparison goods only
3.4     FORECASTS

3.4.1   Experian

The forecasts presented in this paper are from Experian’s model of disaggregated consumer
spending. This uses our UK macroeconomic forecast variables (chiefly consumer spending,
incomes and inflation) as an input and projects forward using assumptions about income and
price elasticities. The shares of the individual components of consumer spending, not just the
levels, will be sensitive to the UK outlook. Growth forecasts are also sensitive to the position of
the base year in the economic cycle. If this is near to a cyclical peak, future growth will
generally be lower than close to a trough.


3.4.2   Consensus forecasts

Consensus views for GDP growth are taken from the Treasury (Forecasts for the UK Economy,
September 2008) and also from Medium-Term Fiscal Projections in the 2008 Budget Report.
Forecasts for household spending for 2007-08 are also from the Treasury. Differences between
household spending and GDP growth after 2009 are taken from Consensus Economics (October
2007). We have not used their household spending or GDP forecasts, as they can be erratic
owing to the small sample.

Results summary:
    Experian’s forecasts for total household spending over the next 5-10 years have moved
        closer close to the consensus, with growth at 1.6 per cent a year over the next decade.
    Forecasts for total retail and comparison goods spending growth are less buoyant than
        trend-based projections, reflecting a view among economists that the growth in
        spending will continue to slow. Household savings rates are at very low levels and
        household indebtedness is at an all-time high and unsustainable in the long term.
    The trend-based projections are little changed from the last report, aside from some
        downward revisions to DIY spending.
    In 2007 spend per head volumes grew by 2.1, 4.8 and 3.8 per cent for convenience,
        comparison and total retail respectively. The current forecasts for 2008, however, are
        for slowdowns to 0.9 per cent in convenience goods and to 3.7 per cent in comparison
        goods, with total retail growing by only 2.6 per cent over the year.
    Note that the growth rates given are in volume terms. Trends in relative prices vary
        considerably between different categories of goods and services, so the volumes figures
        are not necessarily a guide to value trends. Annex 1 gives our view of future trends in
        values, volumes and prices.
                                     TABLE 3.3
                                                                           1
            FORECAST VOLUME GROWTH FOR THE COARSE CATEGORIES (2006 PRICES)
                                                                         2008-2012   2008-2016

Food and non-alcoholic beverages                                               0.8         0.6
Tobacco                                                                       -5.4        -4.3
Alcohol (off trade)                                                            1.6         1.3
Newspapers and periodicals                                                    -2.1        -2.4

Clothing materials & garments                                                  4.9         4.0
Shoes and other footwear                                                       3.6         2.5
Materials for maintenance & repair of the dwelling                             0.6         0.8
Furniture and furnishings; carpets & other floorcoverings                      2.7         2.5
Household textiles                                                             2.1         2.5
Major household appliances whether electric or not                             1.8         1.7
Small electric household appliances                                            2.8         2.4
Tools and miscellaneous accessories                                            3.5         3.4
Glassware, tableware and household utensils                                    2.0         2.4
Non-durable household goods                                                    2.0         1.9
Medical goods & other pharmaceutical products                                  3.0         1.9
Therapeutic appliances and equipment                                          -0.8        -0.1
Bicycles                                                                       3.0         3.0
Recording media                                                                3.6         3.1
Games, toys & hobbies; sport & camping equipment; musiccal instruments         4.6         4.0
Gardens, plants and flowers                                                    0.3         0.6
Pets and related products                                                      0.5         1.4
Books & stationary                                                             0.7         1.3
Audio-visual, photographic & info processing eqpt                             10.7         8.4
Appliances for personal care                                                   2.7         2.3
Jewellery, clocks and watches                                                 -1.7        -0.7
Other personal effects                                                         3.8         3.3

Total Convenience                                                              0.3         0.2
Total Comparison                                                               3.7         3.2
Total Retail                                                                   2.4         2.1
Other Aggregations:
Core DIY Goods                                                                 1.4         1.6
Core DIY Goods exc Gardening                                                   1.8         1.9
Bulky Goods (Comparison)                                                       4.5         3.8
Non-Bulky Goods (Comparison)                                                   3.4         2.9
Leisure                                                                        1.0         0.8
1
    Experian Business Strategies Forecasts, September 2008.
4. Retail potential


4.1     DEFINITIONS

Retail potential is defined as the potential volume of different types of retail business that
spending could sustain in a local area. This is estimated by applying the market shares of these
retail types at the national level to spending at the local level.

4.2     SOURCE

Estimates are based on data from the Annual Business Inquiry (ABI), which gives retail turnover
by good and business (defined using Standard Industrial Classification). Data is available on a
consistent basis from 1999 to 2006. It is still difficult to assess the long-run trend in market
shares, though this should become clearer as the length of the series increases. Note that the
classification in the ABI does not exactly correspond with COICOP. We have reconciled these
inconsistencies, but the estimates should still be regarded as approximate.

4.3     MARKET SHARE ESTIMATES

Table 4.1 shows the estimated market of seven different store types based on ABI data.
                                                                                    TABLE 4.1
                                                                       MARKET SHARES BY SPENDING CATEGORY


                                                                                     Confectioners, Supermarkets                                    Other                  Retail
                                                                                                                  Department Specialised                       Second-
                                                                                     tobacconists & & convenience                        Chemists specialised            sales not   Total
                                                                                                                    stores   food stores                      hand shops
                                                                                       newsagents       stores                                      stores               in stores
1                    Food and non-alcoholic beverages                                        0.016          0.848       0.017      0.058     0.001      0.044      0.000     0.016    1.000
2.2                  Tobacco                                                                 0.161          0.611       0.014      0.145     0.000      0.038      0.000     0.031    1.000
2.1                  Alcohol (off trade)                                                     0.024          0.720       0.009      0.194     0.000      0.026      0.000     0.025    1.000
9.5.2                Newspapers and periodicals                                              0.326          0.398       0.024      0.101     0.000      0.150      0.000     0.000    1.000

3.1.1, 3.1.2, 3.1.3 Clothing materials & garments                                            0.000          0.063       0.092      0.000     0.000      0.774      0.004     0.067    1.000
3.2.1                 Shoes and other footwear                                               0.000          0.033       0.031      0.000     0.003      0.861      0.001     0.071    1.000
4.3.1                 Materials for maintenance & repair of the dwelling                     0.001          0.023       0.031      0.000     0.000      0.912      0.000     0.033    1.000
5.1.1, 5.1.2          Furniture and furnishings; carpets & other floorcoverings              0.000          0.017       0.122      0.000     0.000      0.788      0.036     0.037    1.000
5.2                   Household textiles                                                     0.000          0.075       0.179      0.001     0.001      0.642      0.003     0.099    1.000
5.3.1                 Major household appliances whether electric or not                     0.000          0.090       0.217      0.000     0.005      0.604      0.000     0.083    1.000
5.3.2                 Small electric household appliances                                    0.000          0.090       0.217      0.000     0.005      0.604      0.000     0.083    1.000
5.5.1, 5.5.2          Tools and miscellaneous accessories                                    0.001          0.070       0.096      0.001     0.003      0.761      0.000     0.068    1.000
5.4                   Glassware, tableware and household utensils                            0.000          0.150       0.229      0.001     0.002      0.500      0.082     0.036    1.000
5.6.1                 Non-durable household goods                                            0.002          0.826       0.037      0.005     0.017      0.082      0.000     0.030    1.000
6.1.1, 6.1.2          Medical goods & other pharmaceutical products                          0.003          0.009       0.224      0.146     0.397      0.205      0.000     0.015    1.000
6.1.3                 Therapeutic appliances and equipment                                   0.000          0.042       0.043      0.000     0.168      0.731      0.000     0.015    1.000
7.1.3                 Bicycles                                                               0.005          0.116       0.094      0.002     0.011      0.706      0.004     0.062    1.000
9.1.4                 Recording media                                                        0.001          0.263       0.120      0.001     0.003      0.541      0.002     0.070    1.000
9.2.2, 9.3.1, 9.3.2 Games, toys & hobbies; sport & camping equip.; musiccal instr.           0.007          0.093       0.154      0.006     0.004      0.651      0.004     0.081    1.000
9.3.3                 Gardens, plants and flowers                                            0.001          0.247       0.024      0.019     0.001      0.687      0.000     0.021    1.000
9.3.4                 Pets and related products                                              0.004          0.535       0.023      0.005     0.000      0.419      0.000     0.014    1.000
9.5.1, 9.5.3, 9.5.4 Books & stationary                                                       0.021          0.147       0.077      0.008     0.001      0.648      0.006     0.091    1.000
8.2,9.1.1, 9.1.2, 9.1.3
                      Audio-visual, photographic & info processing equip.                    0.000          0.058       0.142      0.000     0.002      0.701      0.001     0.096    1.000
12.1.2, 12.1.3        Appliances for personal care                                           0.001          0.385       0.305      0.002     0.198      0.086      0.000     0.022    1.000
12.3.1                Jewellery, clocks and watches                                          0.000          0.015       0.097      0.000     0.004      0.766      0.060     0.057    1.000
12.3.2                Other personal effects                                                 0.007          0.050       0.318      0.007     0.004      0.593      0.000     0.021    1.000

                     Total convenience                                                       0.042          0.790       0.019      0.113     0.002      0.048      0.000     0.017    1.032
                     Total comparison                                                        0.002          0.108       0.131      0.005     0.028      0.659      0.011     0.057    1.001
                     Total Retail                                                            0.018          0.377       0.084      0.036     0.017      0.418      0.006     0.043    1.000

                     Other Aggregations:
                     Core DIY goods                                                          0.001          0.106       0.053      0.004     0.001      0.793      0.004     0.038    1.000
                     Core DIY goods excl gardening                                           0.001          0.068       0.060      0.001     0.002      0.821      0.005     0.042    1.000

                     Bulky goods                                                             0.000          0.063       0.118      0.001     0.002      0.745      0.013     0.059    1.000
                     Non-bulky goods (comparison)                                            0.003          0.131       0.133      0.006     0.041      0.616      0.009     0.060    1.000
                     Non-bulky goods (total)                                                 0.023          0.460       0.075      0.045     0.021      0.332      0.004     0.039    1.000
4.4     INTERPRETATION

Table 4.1 shows, for example, that supermarkets and convenience stores receive 84.8 per cent
of spending on food and non-alcoholic drinks and a 61.1 per cent share of tobacco spend. They
also have a 6.3 per cent share of spending on clothing, compared with the 9.2 per cent share in
department stores.

Note that the category ‘retail sales not in stores’ covers mail order including purchases from
wholly internet-based companies, plus purchases from market stalls and door-to-door salesmen.
It does not include internet sales of companies that also have a physical presence, where sales
are allocated by store type. For example, sales from a department store’s website will be
allocated to the ‘department stores’ column not to ‘retail sales not in stores’. This means that the
ABI-based, non-store retail share is probably an under-estimate. Chapter 5 provides a broader
estimate of special forms of trading.
5. Non-store retail sales
   (special forms of trading)
The ONS/ABI definition of non-store retail sales fails to cover the full market, as it does not
include the internet sales (e-tailing) of stores with a physical presence. This has been the subject
of an earlier briefing paper8. Table 5.1, below, gives an update of this based on more recent
data from ONS and IMRG.

                                     Table 5.1
          ESTIMATED AND PROJECTED MARKET SHARE OF NON-STORE RETAIL SALES

           ONS definition of non-store retail sales
                     excluding e-tailing                         E-tailing              Broad definition of non-store retail sales
          Convenience Comparison         Total      Convenience Comparison     Total    Convenience Comparison          Total
  2004         0.9             4.0        2.9           1.6         3.1         2.6         2.5             7.1          5.5
  2005         0.7             3.8        2.7           2.4         4.4         3.6         3.1             8.1          6.3
  2006         0.1             2.8        1.8           3.3         5.5         4.7         3.4             8.3          6.5
  2007         0.1             2.5        1.6           5.1         7.7         6.8         5.2            10.2          8.4
  2008         0.1             2.2        1.4           5.8         9.1         7.9         5.9            11.3          9.3
  2009         0.1             2.0        1.3           6.4        10.2         8.8         6.5            12.2         10.1
  2010         0.1             1.8        1.1           6.9        11.1         9.6         7.0            12.9         10.7
  2011         0.1             1.6        1.0           7.3        11.8        10.1         7.3            13.4         11.1
  2012         0.1             1.4        0.9           7.5        12.2        10.5         7.5            13.6         11.4
  2013         0.2             1.5        1.0           7.6        12.4        10.7         7.8            13.9         11.7
  2014         0.3             1.5        1.1           7.6        12.4        10.7         7.9            13.9         11.8
  2015         0.5             1.5        1.1           7.6        12.4        10.8         8.0            13.9         11.9
  2016         0.5             1.5        1.2           7.6        12.4        10.8         8.1            13.9         11.9
Sources: National Statistics, Experian


The current estimates are based on the ONS e-commerce Survey of Business, updated using
data from the monthly Interactive Media Research Group (IMRG) survey. The projections are
based on work done by Forrester Research on behalf of IMRG.

Important points to note are:

        An internet sale does not necessarily imply that items have not passed through a retail
         outlet. Some supermarkets source internet goods from store space. This means that the
         5.1 per cent share of e-tailing in convenience sales in 2007 may be an over-estimate.
        There is a high degree of uncertainty in projecting the uptake of new technology. Much
         speculation about e-commerce could be exaggerated, with the recent acceleration a one-
         off surge due to broadband.
        A plausible “low case” from the broad market share of all Non-Store Retail sales in
         2016 (i.e. including e-tailing) would be around 6, 13 and 10 per cent for convenience,
         comparison and total spending respectively.




8
 Retail Planner Briefing Note 2.3D “Estimates & Projections of the Share of E-tailing in UK Retail Spending”,
December 2005.
   6. Comparison with retail sales data

   6.1       INTRODUCTION

   In recent years, official data show the volume of consumer spending on retail goods rising faster
   than the retail sales measure (known as ‘business base’ estimates from a survey of retailers). We
   estimate that consumer spending on retail goods was 75.8 per cent higher in 2007 than in 1995.
   The equivalent figure for retail sales is 60 per cent. There are a number of reasons for this.

   6.2       DIFFERENCES IN METHODS OF PRICE DEFLATION

   Both retail sales and consumer spending are collected in current prices and converted to
   constant prices by deflating using price indices. The gap in growth rates for current price series
   is less, implying deflation explains some of the difference, despite individual price indices all
   tending to be based on components of the RPI. Note also that the retail sales index is still
   compiled using a fixed-base method rather than the annual chain-linking used for consumer
   spending. This will also lead to some difference in estimated growth rates.

   6.3       UNDER-RECORDING OF RETAIL SALES DATA

   Since 1997, annual estimates of the value of retail sales have also been available from the
   ONS’s ABI. This is a much larger survey than the Retail Sales Inquiry used to compile the other
   sales estimate. The ABI is, however, only available in current prices. Table 6.1 shows the two
   estimates of retail sales growth with consumer spending on retail goods, all in current prices.
                                                 TABLE 6.1
                       ALTERNATIVE ESTIMATES OF RETAIL SALES VALUE GROWTH
                          1998   1999     2000     2001      2002   2003    2004    2005    2006        2007
Retail Sales Inquiry       4.3    3.2      3.5     6.0       4.8    2.6     4.6      0.7     2.7        3.8

Annual Business Inquiry    6.6    4.5      4.5     4.0       5.4    4.7     3.8      2.6     4.8        n.a.
Household spending on
                           5.0    5.6      4.4     4.5       5.7    5.3     4.7      1.3     3.6        5.3
retail goods
Source: ONS.


   ABI growth rates tend to be closer to our household spending on retail goods series, perhaps not
   surprisingly as these figures are used in compiling these estimates. Estimates from the Retail
   Sales Inquiry have tended to be less buoyant, showing slower growth during 1998-2000, 2002-
   03 and again 2005 onwards.

   6.4       DIFFERENCES IN SOURCES

   The different retail demand measures are compiled using different sources. Household spending
   is based on consumer surveys, though it also uses ABI information from businesses, while the
   Retail Sales Inquiry is a survey of retailers. Statistical discrepancies are likely where data is
   sourced differently.

   But, as the household spending estimates are part of the National Accounts, the UK’s most
   heavily scrutinized economic release, they are close to definitive official statistics. The Retail
   Sales Inquiry is a useful indicator of short-term trends and is published more frequently
   (monthly), but is less satisfactory for long-term comparison.
7. Price trends

7.1     DATA & DEFINITIONS

The table in Appendix 1 shows historical data on the prices of retail goods as well as for sales,
volumes and values. Data is given for four categories:

                    consumer spending (including services, cars and fuel as well as retail goods);
                    retail goods (that is, convenience plus comparison goods);
                    convenience goods; and
                    comparison goods.

Figure 7.1 shows the annual inflation rates for these four categories and Figure 7.2 shows retail
goods’ prices relative to all consumer goods and service prices.

                                            FIGURE 7.1:
                                      CONSUMER PRICE INFLATION
         12        annual % change

         10

          8

          6

          4

          2

          0

         -2

         -4
              1981    1984    1987 1990 1993     1996   1999   2002   2005 2008 2011      2014
                             Consumer Spending                         Retail Goods
                             Convenience Goods                         Comparison Goods


The historical data is based on the ONS estimates, with forecasts from Experian. Note that these
retail goods prices are not the same as definitions within the Retail Price Index (RPI). The name
RPI is a misnomer, as it refers to the price of a basket of retail goods, but also includes services.
Our price indices refer solely to retail goods categories as defined in previous chapters.

The broader consumer spending deflator refers to the price of all goods and services in the
National Accounts definition (also referred to as household spending). Because of its different
treatment of housing costs, its movements tend to be closer to the current policy target, the
Harmonized Index of Consumer Prices (HICP, but also known as the Consumer Price Index),
than to RPI excluding mortgage interest (RPIX).
7.2     TRENDS IN INFLATION AND PRICES

The key trend of Figure 7.1 is the gradual easing in consumer inflation rates over time, with
occasional interruptions (most notably from the late 1980s, and then again more recently). Price
pressures have intensified recently as a result of which consumer inflation is forecast to have
picked up to nearly 3 per cent in 2008. Our forecast is that price increases will slow to 2.6 per
cent by 2010 and then to 2.1 per cent in the longer term.

Goods price inflation decelerated even more rapidly, with deflation apparent in some categories
since the late 1990s. Comparison goods’ prices in particular have been plummeting, as
electronics have fallen sharply.

During the forecast, goods deflation is expected to come to an end, with comparison prices
broadly flat and modest rises for all retail goods. The reasons for the upturn in retail inflation
are that opportunities for sustained cost reductions through increased productivity or global out-
sourcing are expected to decline in future. Rates still remain low relative to any other period
since 1980, but prices do not fall.
8. Changes in the efficiency of retail floor
space

8.1       ESTIMATING SALES DENSITY

Experian has recently completed a research project for the British Council of Shopping Centres,
which re-assessed retail efficiency estimates and projections.9

This new work includes a number of additions and, most importantly, it covers two neglected
areas: 10
     changes in net-to-gross space ratios; and
     comparison sales in convenience stores.

8.2       RETAIL SPACE AND SALES DENSITY

The total volume of sales that can be delivered by a given floor space – the sales density – is a
variable in any planning inquiry. Projections of sales density will profoundly influence
assessments of the growth potential for in-store retail sales that can be accommodated from
existing floor space.

Sales density can change for many reasons, including:

              Improvements in the efficiency of existing processes or technology, for example, a
               more effective till arrangement to reduce peak-time queues
              The replacement of older capacity with newer, more efficient space
              Changes in opening hours (such as Sunday trading), potentially increasing the
               amount of sales made from the same floorspace in a given time.
              Shifts in the mix of goods offered towards smaller or higher value items, such as a
               move from furniture to electronic equipment
              Planning restrictions limiting the amount of new space, forcing densities higher as
               sales increase from existing capacity; and
              Retailers squeezing more selling space out of a building, for example by cutting
               down on storage, increasing gross, but not net density.

Sales densities also tend to move with the economic cycle. In sales booms, they tend to rise as
people buy more, only to decline again in the subsequent slowdown. Although they do have an
impact on sales density, such cyclical fluctuations in demand are temporary and need to be
carefully isolated from the underlying trend in any long-term analysis.

Generally, more successful centres or stores in the UK will see high and rising densities, while
those in decline experience the opposite. But this does not mean that high densities are good for
profitability, as retailers face different cost structures in different places. It is entirely possible,
for example, that a retailer could meet stronger demand and make more profit from a lower
sales density, provided the space enabled the more efficient use of labour or logistics, or was in
a location where rents and overheads were lower.


9
  Previous estimates and projections for the changes in the efficiency of retail floorspace were presented in Retail
Planner Briefing Note 2.2 (April 2005).
10
   See http://www.bcsc.org.uk/publication.asp?pub_id=221 for a summary of the BCSC work.
8.3       MEASURING SALES DENSITIES

Sales density is typically measured as either:

         Sales relative to the total floorspace (gross) – as used in official statistics and planning
          requirements. This is sales relative to the actual area covered by the buildings.
         Sales relative to the net sales area (shopping space) only, as quoted by retailers. This
          excludes storage space, offices and toilets, but includes display areas.

An investigation of trends in sales densities is hampered by a lack of quantitative information.
Estimation of sale density requires a space measure. At present, UK retail floorspace estimates
are derived from two sources:

         The Valuation Office Agency (VOA), which is part of HM Revenue and Customs and
          publishes a measure of retail space close to the property industry’s gross definition.
         Larger retailers provide net density estimates, although definitions are not standardised.

The VOA data is potentially most valuable, although it has limitations:

         These figures are defined as net space, but exclude only non-useable areas - such as
          staircases, but not storage - and so are actually closer to a total or gross floorspace.
         VOA totals vary between an all-retail and A1 space definition, depending on the year.
          Neither is precise and there are large jumps in the data, notably in 1998 and 2005.
         From 2005 the A1 space definition is no longer available and the all-retail definition has
          several breaks in the series which do not allow long-term time series analysis.
         The data only cover England and Wales.
         There is no breakdown into comparison and convenience stores, or between comparison
          and convenience goods space11.

VOA numbers only indicate gross retail space (i.e. the total space occupied by the buildings),
with no details on the split for different goods, or of how net capacity has changed. To provide a
fuller breakdown, a combination of industry benchmarks and consultation was used to split the
total into convenience and comparison, into in-town and out-of-town and to identify net, or
actual shopping space, as well as the total space occupied by the buildings.

Experian’s new methodology uses expert estimates to inform a view on the key unknowns:

         Gross floor space split – in-town versus out-of-town, modern versus old and
          convenience versus comparison
         Net-to-gross ratios
         Proportions of convenience store space used for selling comparison goods; and
         Detailed sales densities in 2007 and growth rates between the benchmark years.

These estimates are combined to estimate figures that can be compared with official data. For
example, does net comparison floorspace multiplied by its sales density, summed across all
types of comparison space (including space in convenience stores) give total in-store
comparison goods sales? Afterwards, if there is any mismatch, this process is repeated until
estimates are within £500,000 of the figures.


11
   It is important for this kind of analysis to distinguish between comparison and convenience goods (as defined
earlier in this report) and convenience and comparison stores. Convenience or comparison stores can and do sell a
mix of both convenience and comparison goods and an increasing share of convenience stores’ sales has been coming
from comparison goods.
The results are not data in the strict sense, but an educated guess consistent with the available
evidence. There is little alternative to the iterative process used to generate the final figures and,
given the uncertainty, some experts may reasonably question the estimates. But they provide the
most satisfactory combination of official data and expert opinion available.

The detailed calculations are given below, with data in bold type. 12 All other numbers are
derived using assumptions in italics. Note spending and density figures are expressed in
constant (2006) prices. This means that historical sales densities will be different from current
price figures, except in the base year. Constant prices measures are necessary to gauge the
relationship between sales and space required.




12
     That is total gross space estimates (Valuation Office Agency definition) and spending in constant prices (KP).
       FIGURE 8.1: ESTIMATED FLOORSPACE, SALES AND SALES DENSITIES
                                 1986-2007
                                                                                                Growth rates (%p.a.)

                                         1986      1999       2005       2005         2007        1987-99    2000-05    1987-05   2006-2007

                                      A1 Retail floorspace            Total Retail floorspace
1    Total (E&W) Retail                57,827    72,408      77,438 103,095       105,340              1.7        1.1       1.5         1.1
2        Proportion in-town              0.85      0.80        0.75    0.75          0.73
3        Proportion out-of-town          0.15      0.20        0.25    0.25          0.27
4        In-town                       49,153    57,926      58,079 87,631         89,539             1.3        0.0        0.9         1.1
5        Out-of-town                    8,674    14,482      19,360 15,464         15,801             4.0        5.0        4.3         1.1
                                          1.025
6 Allowance for Gross-VOA definitition discrepancy1.025       1.025     1.025        1.025
7        Convenience Store/Total
8        In-town                         0.30      0.25        0.25       0.25        0.25
9        Out-of-town                     0.55      0.41        0.34       0.34        0.32


     Convenience Stores
     Stock of Space (VOA defnition)
10       In-Town                        14746     14539      14520      21908       22385             -0.1        0.0      -0.1         1.1
11       Proportion Modern               0.50      0.55       0.60       0.60        0.61
12       Modern Space                    7373      7997       8712      13145       13655              0.6        1.4       0.9         1.9
13       Old Space                       7373      6543       5808       8763        8730             -0.9       -2.0      -1.2        -0.2
14       Out-of-Town                     4771      5937       6582       5258         5056             1.7        1.7       1.7        -1.9
15       Proportion Modern               1.00      1.00       1.00       1.00        1.00
16       Modern Space                    4771      5937       6582       5258        5056              1.7        1.7       1.7        -1.9
17       Old Space                           0         0          0          0           0
18       Total                          19517     20477      21102      27166       27441              0.4        0.5       0.4         0.5
19       Proportion of all retail         0.34      0.28       0.27       0.26        0.26
     Net-to-Gross ratios
20        In-Town     Modern             0.64      0.67        0.70       0.70        0.70
21                    Old                0.60      0.60        0.60       0.60        0.60
22        Out-of-town Modern             0.64      0.67        0.70       0.70        0.70
23                    Old                0.60      0.60        0.60       0.60        0.60
24        All Modern                     0.64      0.67        0.70       0.70        0.70
     Stock of Space (net)
25       In-Town     Modern              4837      5492       6251       9431        9797              1.0        2.2       1.4         1.9
26                   Old                 4534      4024       3572       5389        5369             -0.9       -2.0      -1.2        -0.2
27       Out-of-town Modern              3130      4078       4723       3773        3628              2.1        2.5       2.2        -1.9
28                   Old                    0         0          0          0           0
29       Total                          12501     13593      14545      18593       18794              0.6        1.1       0.8         0.5
     Proportion of Sales Area Devoted to Comparison Goods
30       In-Town     Modern               0.05   0.10    0.20             0.20        0.22
31                   Old                  0.00   0.05    0.10             0.10        0.12
32       Out-of-Town Modern               0.10   0.20    0.30             0.30        0.33
33                   Old                  0.00   0.00    0.00             0.00        0.00
34       Total                            0.04   0.12    0.21             0.19        0.21
     Stock of Convenience Space(net) in Convenience Stores
35       In-Town     Modern             4595    4943     5001            7545        7642              0.6        0.2       0.4         0.6
36                   Old                4534    3823     3215            4850        4725             -1.3       -2.8      -1.8        -1.3
37       Out-of-town Modern             2817    3262     3306            2641        2431              1.1        0.2       0.8        -4.1
38                   Old                   0       0        0               0           0
39       Total                         11946   12027    11521           15036       14797              0.1       -0.7      -0.2        -0.8
     Sales Densities for Convenience Space in Convenience Stores (net)
40       In-Town      Modern             6329    7148    7724      7,724             7926              0.9        1.3       1.1         1.3
41                    Old                2959    3053    3090      3,090             3102              0.2        0.2       0.2         0.2
42       Out-of-town Modern              8489    9587   10299     10299             10547              0.9        1.2       1.0         1.2
43                    Old                2971    3356    3605       3605             3692              0.9        1.2       1.0         1.2
44       Total                           5559    6508    7170       6681             6771              1.2        1.6       1.3         0.7
     Convenience Spending - Total
45      Spending (KP, UK)               80383     94650 102801 102801              107172              1.3        1.4       1.3         2.1
46      E&W Share of UK                  0.891     0.893   0.89   0.89                0.89
47      Spending (KP, E&W)              71621     84522  91493  91493               95383              1.3        1.3       1.3         2.1
48       Sales of Convenience Goods    70977      83762      89022      89022       92521              1.3        1.0       1.2         1.9
49       Convenience Goods Space (net) 11946      12027      11521      15036       14797              0.1       -0.7      -0.2        -0.8
     Aggregate Convenience Sales Densities (net)
50       Actual                         5942     6964         7727       5921         6253             1.2        1.7       1.4         2.8
51       Implied                        5559     6508         7170       6681         6816             1.2        1.6       1.3         1.0
                                          1986       1999     2005     2005      2007     1987-99    2000-05    1987-05    2006-2007
      Comparison Stores

      Stock of Space (VOA defnition)
 52        In-Town                       34407      43387    43559    65723     67154          1.8        0.1        1.2          1.1
 53        Proportion Modern              0.35       0.38     0.40      0.40      0.41
 54        Modern Space                  12042      16487    17424    26289     27533          2.4        0.9        2.0          2.3
 55        Old Space                     22365      26900    26135    39434     39621          1.4       -0.5        0.8          0.2
 56        Out-of-Town                    3903       8544    12777    10206     10745          6.2        6.9        6.4          2.6
 57        Proportion Modern              1.00       0.95     0.90      0.90      0.90
 58        Modern Space                   3903       8117    11500     9186      9670          5.8        6.0        5.9          2.6
 59        Old Space                          0        427    1278     1021      1074
 60        Total                         38310      51931    56336    75929     77899          2.4        1.4        2.1          1.3
 61        Proportion of all retail        0.66       0.72     0.73     0.74      0.74
      Net-to-Gross ratios
 62        In-Town      Modern             0.59      0.65     0.70     0.70      0.73
 63                     Old                0.55      0.58     0.58     0.58      0.58
 64        Out-of-town Modern              0.65      0.70     0.80     0.80      0.82
 65                     Old                0.60      0.70     0.70     0.70      0.70
 66        All Modern                      0.60      0.67     0.74     0.73      0.75

      Stock of Space in Comparison Stores(net)
 67       In-Town     Modern             7283       10984    12501    18863     20602          3.2        2.2        2.9          4.5
 68                   Old               12608       15992    15537    23443     23555          1.8       -0.5        1.1          0.2
 69       Out-of-town Modern             2601        5824     9430     7532      8128          6.4        8.4        7.0          3.9
 70                   Old                    0        307      917      732       771
 71       Total                         22491       33107    38385    50571     53055          3.0        2.5        2.9          2.4

      Comparison Space in Convenience Stores (net)
 72      In-Town     Modern              242       549        1250     1886      2155
 73                  Old                   0       201         357      539       644
 74      Out-of-town Modern              313       816        1417     1132      1197
 75                  Old                   0         0           0        0         0
 76      Total                           555     1566         3024     3557      3997          8.3       11.6        9.3          6.0

 77 Total Comparison Space               23046      34673    41409    54128     57052          3.2        3.0        3.1          2.7

      Sales Densities for Comparison Stores (net)
 78       In-Town      Modern             2644       3645     4586    4,586      4950          2.5        3.9        2.9          3.9
 79                    Old                1616       2228     2802    2,802      3025          2.5        3.9        3.1          3.9
 80       Out-of-town Modern              1469       2025     2548    2,548      2750          2.5        3.9        3.1          3.9
 81                    Old                 735       1013     1274    1,274      1375          2.5        3.9        3.1          3.9
 82       Total                           1932       2651     3284     3407      3707          2.5        3.6        2.8          4.3
 83       Modern                          2335       3084     3709     4004      4328

      Sales Densities for Comparison Goods in Convenience Stores (net)
 83       In-Town      Modern            2938     4050    5095     5095          5500          2.5        3.9        2.9          3.9
 84                    Old               2057     2835    3567     3567          3850          2.5        3.9        3.1          3.9
 85       Out-of-town Modern             2938     4050    5095     5095          5500          2.5        3.9        3.1          3.9
 86                    Old               2057     2835    3567     3567          3850          2.5        3.9        3.1          3.9
 87       Total                          2938     3894    4915     4864          5234          2.2        4.0        2.7          3.7

      Comparison Spending - Total
 88      Spending (KP, UK)               50823 105288 165134 165134            183178
 89      E&W Share of UK                  0.891  0.893   0.89   0.89             0.893
 90      Spending (KP, E&W)              45283  94022 146969 146969            163578          5.8        7.7        6.4          5.5

 91       SFT                             0.026      0.026   0.08   0.08          0.08
 92       Sales of Comparison Goods      44106      91578 135212 135212        150492          5.8        6.7        6.1          5.5
 93       - from Convenience Stores        1630       6098 14863  17300         20921         10.7       16.0       12.3         10.0
 94       - from Comparison Stores       42476      85480 120349 117912        129570          5.5        5.9        5.6          4.8

      Aggregate Comparison Goods Sales Densities (net)
 95       Actual                       1914     2641          3265     2498      2638          2.5        3.6        2.9          2.8
 96       Implied                      1956     2707          3403     3503      3814          2.5        3.9        3.0          4.3

      Summary (net)

          Convenience Spending           70977      83762    89022    89022     92521          1.3        1.0        1.2          1.9
          Convenience Space              11946      12027    11521    15036     14797          0.1       -0.7       -0.2         -0.8
          Convenience Densities           5942       6964     7727     5921      6253          1.2        1.7        1.4          2.8

          Comparison Spending            44106      91578 135212 135212        150492          5.8        6.7        6.1          5.5
          Comparison Space               23046      34673  41409  54128         57052          3.2        3.0        3.1          2.7

Units: Floor space is in thousands of square metres; densities are £ per square metre and spending in £m at constant (2006) prices.
Source: Experian. Spending data are in constant (2006) prices. Estimates may not sum exactly.
The relationship between the rows

Rows 1-9 – show the breakdown of total gross space (VOA basis) into in-town and out-of-town
and the assumed shares of convenience and comparison stores. The estimates show a continuing
rise in total out-of-town share and a downward drift in the convenience share out of town.

Rows 10-19 – show the breakdown of convenience store space into ’modern‘ and ’old‘ space.
Modern space can be newly built or created by the refurbishment of old space. So:
Row 10 = Row 4 x Row 8        Row 12 = Row 10 x Row 11          Row 13 = Row 10 – Row 12

Rows 20-29 – shows the conversion of convenience store gross space into net space. This
involves multiplying VOA basis space by a VOA discrepancy13 and by the net-gross ratio Thus:
Row 25 = Row 11 x Row 6 x Row 20.

Estimates show although gross convenience space increased by 0.4 per cent a year between
1987 and 2005, net space increased twice as fast, as a result of increases in the net-gross ratio.

Rows 30-39 – show the proportions of convenience store net floorspace devoted to the sale of
comparison goods. It is estimated that this was 21 per cent for all space and 30 per cent for
modern out-of-town space. The relationship between the rows, for example, is:
Row 35 = Row 25 x (1 – Row 30)

Estimates imply only a small increase in net convenience floorspace in convenience stores
between 1987 and 1999 and a decline after 2000. Note estimates were put together with
consistency to the data in mind and informed by net sales densities published by the major
supermarket chains14 (allowing for the increased share of comparison goods and performance
more applicable to modern than old space).

Rows 40-51 – reconcile net floorspace, net sales densities and spending on convenience goods.
Row 44 is the weighted average of Rows 40-43 and Row 49 approximately equals Row 39
multiplied by Row 44 (divided by a thousand to correct the units). The answer is approximate
because of the iterative process.

Convenience good densities increased at an average rate of 1.2 per cent a year between 1987
and 2000, but each of the individual components (Rows 40-43) increased more slowly. The
reason for the discrepancy is the move from relatively-low-sales-density old space to relatively-
high-sales-density modern space. A similar change is observed between 2000 and 2005.

Rows 52-61 – shows the breakdown of comparison store space into ‘modern’ and ‘old’. Thus:
Row 52 = Row 4 x (1 - Row 8) Row 54 = Row 52 x Row 53 Row 55 = Row 52 – Row 54

Rows 62-71 - shows the conversion of comparison store gross space into net space by
multiplying estimated VOA space by VOA discrepancy and by the net-gross ratio. For example:
Row 67 = Row 53 x Row 6 x Row 30

Estimates show average annual increases in net comparison store space of 3.0 per cent between
1987 and 1999, and 2.5 per cent from 2000 to 2005, comfortably outstripping the growth in
gross comparison store space (at 2.4 and 1.4 per cent). As with convenience store space, this is
due to increases in the net-gross ratio for comparison stores.




13
     The VOA measure is closest to the property industry definition, but still excludes gross space such as stairwells.
14
     These average under 1 per cent a year between 1987 and 1999 and under 1¼ per cent between 2000 and 2005.
Rows 72-77 – shows the estimated amount of comparison goods space in convenience stores
and the implied total amount of comparison goods space. This is derived from Rows 25-28
multiplied by Rows 30-33.

We estimate that the amount of comparison goods space in convenience stores has been
growing quite rapidly. So the total amount of comparison goods space (comparison store space
plus comparison space in convenience stores) has been growth even faster (at 3.2 per cent and 3
per cent in 19987-99 and 2000-05, or Row 77 compared with Row 71).

Rows 78-92 - attempt to reconcile disaggregated estimated increases in sales densities (Rows
78-87) with estimate net floorspace (Rows 67-77) and estimated spending (Rows 88-92) for
comparison goods. Thus: Row 71 x Row82 + Row 76 x 87  Row 92

Where the relationship is close, but not exact, it is because of the iterative process. Estimates
show sales and net space are consistent with densities for each type of comparison good space,
increasing at average annual rates of 2.5 for 1987-1999 and 3.9 per cent in 2000-2005.

Rows 93-94 – show the derived estimates of sales and sales gross of comparison goods from
convenience and comparison stores separately. Note that the new estimate for 1987-99 is less
than the 3.1 per cent a year previously published by Experian15. The main reason for this is that
the new sales density estimates are net rather than gross. More recent data on the impact of non-
store retail sales also made a contribution.

Row 95 – shows sales density for all comparison goods space from Row 92 and Row 77.

Our adjusted version of this series provides the most consistent estimate of recent trends in
retail space available summarised below (see figure 8.2). This shows growth in available retail
space averaging 1.5 per cent a year between 1987 and 2005, though slowing this decade. Since
2005, floorspace data has covered the retail sector as a whole, rather than just A1 (shops).
Nevertheless we have completed the analysis from 2001 to 2007 in an attempt to cover recent
developments.

       FIGURE 8.2: FLOORSPACE, SALES AND SALES DENSITY GROWTH (ENGLAND & WALES)
                             (average annual growth, sales in constant prices)
                                          1987-99         2000-05    1987-05   2001-04   2006-07
       Floorspace (%p.a.)
       Total (gross)                          1.7              1.1    1.5        1.1      1.1
       Total (net)                            2.2              2.1    2.2        1.8      1.9
       Convenience (net) 1                    0.1             -0.7    -0.2      -1.2      -0.8
       Comparison (net) 2                     3.2              3.0    3.1        2.7      2.7
       Sales (% p.a.) 3
       Convenience                            1.3             1.0      1.2       1.0       1.9
       Comparison                             5.8             6.7      6.1       7.1       5.5
       Sales Densities (% p.a.)
       Total (gross)                          1.5             3.0      2.0       3.3       3.0
       Total (net)                            1.0             2.0      1.3       2.6       2.1
       Convenience (net) 1                    1.2             1.7      1.4       2.2       2.8
       Comparison (net) 2                     2.5             3.6      2.9       4.2       2.8

Our estimates highlight a number of interesting trends since the late 1980s:




15
     Retail Planner Briefing Note 2.2, Table 1, April 2005.
         Comparison goods sales densities have shown exceptional growth. Comparison
          goods sales space increased at an average annual rate of 3.0 per cent between 2000 and
          2005 (including for comparison goods sales in convenience stores). But sales volumes
          rose at an annual rate of almost 7 per cent over the same period, implying that net sales
          density has risen by 3.6 per cent a year to accommodate this. This average was actually
          dragged down by an increase in the share of floor space taken by, lower density, out-of-
          town stores. Retailers are therefore using new and existing space more efficiently to
          make more sales. For the earlier period, 1987-1999, the growth rate was 2.5 per cent per
          annum. For total retail we have seen floor space devoted to comparison goods continue
          to grow at 2.7 per cent while sales have slowed.
         Convenience goods sales density growth has been considerably slower in comparison.
          In the case of convenience goods, however, the change in the space mix towards larger
          more efficient stores has pushed up the observed total increase in density growth
          relative to the underlying growth trend. Between 2000 and 2005 the overall increase in
          sales densities for convenience goods was 1.7 per cent a year but the underlying growth
          rate was 1.2 per cent a year, the difference being accounted for by a move towards
          newer higher density stores. The equivalent figures for 1987-1999 were 1.2 and 0.9 per
          cent for actual and underlying respectively. The latest data, based on total retail floor
          space shows sales densities picking up to match the growth in comparison goods at 2.8
          per cent as sales have accelerated and floor coverage has been falling less quickly.
         Net floorspace has consistently grown faster than gross since the 1980s, implying an
          increasing proportion of floorspace has been converted to selling, and that space for
          storage and back-of-house activities has been reduced.
         The growth in comparison space has greatly exceeded that for convenience, which
          has been contracting recently. This is partly because convenience stores such as
          supermarkets have expanded comparison goods lines, like clothes, electrical goods or
          DVDs. This trend is expected to continue, with Tesco aiming to reach an even balance
          between food and non-food in its larger stores in the next few years.
         Comparison goods sales densities have increased at a far faster rate than
          convenience goods, partly owing to technological advances leading to smaller, higher-
          value products, for example the difference in size between a flat-screen and a traditional
          television. With more consumers shopping locally as a result of higher petrol costs and
          the introduction of farmers markets, and changing tastes for DIY goods and increased
          spending on food, this gap has closed slightly over the last few years.

On balance, the early 2000s was an unusually rapid phase of sales growth, reflected in big
increases in densities. Part of this rise is likely to be cyclical and thus not sustainable. It is worth
noting that the 2006-07 growth rates particularly in comparison goods, are more in line with the
long-term expansion witnessed in the 1987-99 figures.

8.4       INFLUENCE OF LONGER OPENING HOURS

The introduction of Sunday shopping significantly lengthened opening hours in the 1990s, with
profound implications for the trend in sales densities.16 Unfortunately, there are no statistics on
Sunday business, or, more important, on how the extension affected sales in the rest of the
week. But related evidence points to a major shift in consumer behaviour. Footfall figures on
visits to retail centres, for instance, show that shopping patterns have changed markedly, with
on average, around 8 per cent of weekly activity now taking place on a Sunday (Figure 8.3).17



16
  The Sunday Shopping Act was brought in 1994 but a number of chains were already opening by then.
17
  At any given time of the day stores may be busier on Sundays than on some weekdays, but shorter Sunday opening
hours brings average Sunday footfall down relative to other days. Footfall data also shows big differences between
shopping centres with Sunday being the second busiest day of the week in some centres.
When Sunday trading was first introduced it is likely that total retail spending remained largely
unaffected and was spread over more days, with little impact on sales or densities. Over time,
however, as Sunday trading effectively increases retail capacity at a stroke, it enables more sales
to be made from the existing floorspace. As such, it allows new sales growth without the
corresponding requirement for new retail space.

A store opening for, say, 16 hours could potentially realise twice the sales density of one open
for 8 hours. In practice this would require a considerable change in consumer behaviour, not
least the desire to shop first thing in the morning or last thing at night. Along the same lines, the
impact of an extra day’s trading is less, but still implies the potential for an increase in sales
densities over time.

                                              FIGURE 8.3: AVERAGE FOOTFALL BY THE DAY OF THE WEEK

                                         25
          percentage of weekly average




                                         20

                                         15

                                         10

                                          5

                                          0
                                                Monday   Tuesday   Wednesday   Thursday   Friday   Saturday   Sunday


      Source: Footfall
But how much of the change in sales density does this explain? We can adjust our previous
estimates to account for Sunday trading. Assuming that all of the impact occurred between 1986
and 1999 and that daily sales are proportional to footfall, longer opening would have accounted
for 0.7 per cent of the annual increase in sales densities over this period.18

8.4       INFLUENCE OF 24-HOUR SHOPPING

Sunday trading is now a normal part of the UK retail environment, but the potential of 24-hour
shopping remains disputed. This could have a similar impact on potential sales densities as
Sunday trading. At the extreme, it can be argued that the move to all-day shopping alone could
cause any future growth in retail sales to be absorbed in higher densities and remove the need
for more retail space in future.

But the evidence is not strong. Although there is 24-hour opening in some supermarkets, this is
usually seen at out-of-town convenience stores, or at times of heavy demand such as Christmas,
or in urban centres where footfall is particularly heavy. This has often been possible because the
stores are staffed anyway, with the need for over-night restocking, rather than a result of
demand from shoppers. Few other retailers have followed the supermarkets. Current lifestyles
and habits do not suggest a wholesale move to 24-hour shopping. This may change in the future,
but it is too early to make strong assumptions in our forecasts.


18
  The Footfall figures show Sunday Footfall accounting for just over 8 per cent of the weekly total implying that the
introduction of Sunday trading has increased capacity by just over 9 per cent. This is the equivalent of 0.7 per cent
per annum over thirteen years.
8.6     THE FUTURE FOR RETAIL SALES DENSITIES

The rapid increase in comparison goods sales densities in the recent past was a product of the
retail spending boom and is unlikely to be sustainable. On balance, the 1987-99 trend of 2.5 per
cent growth a year in sales density, may be a better starting point for projections.

Even this includes one-off changes because of the advent of Sunday trading. As noted, the
introduction of Sunday trading could have accounted for up to 0.7 per cent a year of the
estimated increase in sales densities in this period. On the other hand, not all Sunday trading
effects occurred in 1986-99 and there is still scope for further changes were the current
restrictions on hours to be relaxed.

Consequently, projected sales densities are only reduced from the 1987 and 1999 by 0.3 per cent
a year in the central case, to 2.2 per cent and 0.6 per cent a year for comparison and convenience
space respectively. The move towards more modern, higher density, stores and the demolition
of older inefficient space means that the observed comparison rate is likely to be closer to 2.4
per cent a year.

The combination of unsatisfactory data and uncertainty about underlying trends mean that risk
analysis is particularly important. Much slower density increases than in the central forecast
imply there is higher demand for capacity. One possible cause is the impact of longer opening
hours has been overstated, another that the gains from technological change and efficiency are
exhausted. As a result, increased sales growth can only be met by new retail.

In this alternative view, it is assumed that comparison goods sales densities grow at only 1.5 per
cent a year (or 0.25 per cent a year for convenience goods). This was the benchmark figure for
retail planning studies until recently and is significantly slower than historical trends. On the
other hand, the more recent growth rates (2000-2005) were much higher than for the 1987-99
growth rates that we have used to create the central case. This means that there must be a
significant upside and we suggest that a realistic upside would be 2.8 and 0.8 per cent for
comparison and convenience goods sales densities respectively.
9. Small area estimates


9.1     INTRODUCTION

Aggregate consumer expenditure statistics are released at the regional level. This provides an
overview of regional trends and differences, but further variations exist in more detailed
geographies. Evidence suggests wide differences in spending patterns between households
located within a short distance of each other, even from street to street. To examine this,
Experian estimates figures for Ward, Postal Sector or Output Areas, collectively referred to as
small areas. This method is detailed below.

9.2     ESTIMATING EXPENDITURE FOR SMALL AREAS

There are two elements involved in estimating the available expenditure for a given area:

       Estimating the number of people living in the area.
       Assessing the demographic characteristics of people living in the area.

9.3      Estimating the number of people living in the area

The number of people living within a given area is a key determinant of total expenditure, as
these are derived from spending per head estimates grossed up using population figures. The
last full census was in 2001. The government publishes mid-year population updates on an
annual basis, but not at the “small area” level. Experian has, therefore, used sophisticated model
projections to move these figures to 2007.

9.4      Assessing the demographic characteristics

Using accurate population estimates alone will not provide a true measure of spending.
Demographic profiles also have a large effect. In general, people with higher incomes spend
more than people with lower incomes. But there are also differences in more detailed spending
characteristics – for example, young people in their first homes generally spend more heavily on
DIY and household goods such as washing machines and TVs.

The more accurately we can identify the different types of people within an area, the better our
total expenditure estimates. Experian’s Mosaic is the world’s most heavily used customer
segmentation system and we use this in our projections. Mosaic uses data various sources,
including the Census and surveys of consumer behaviour covering millions of households. It
classifies people into one of 61 distinct types, containing people that are similar to each other,
but different from other groups.

For many years, respondents to the Family Expenditure Survey have been coded by Mosaic.
This allows us to understand detailed spending patterns by each Mosaic type. This information
is considered representative and robust, with the Family Expenditure Survey covering more than
7,000 UK households.

One of the more affluent Mosaic types is Corporate Chieftains. The annual Family Expenditure
Survey reveals that the average annual expenditure per head on footwear by this type is £82. For
less affluent Mosaic types, such as Rustbelt Resilience, the total might be £36 a year. So an
Output Area containing 200 Corporate Chieftains, the total expenditure on footwear would be
£16,400 (£82 multiplied by 200). For an Output Area containing 200 people classified as
Rustbelt Resilience, the total expenditure on footwear would be £7,200 (£36 multiplied by 200).

In practice, small areas will contain a mix of types. Using the previous example, in an Output
Area of 100 Corporate Chieftains and 100 Rustbelt Resilience, the total expenditure on footwear
would be £11,800 (£82 multiplied by 100 plus £36 multiplied by 100). Mosaic classifies at the
postcode level, so we identify the demographic mix within the smallest areas. Postcodes contain
on average about 40 people and there are several Mosaic types within each Output Area, with
even greater diverse in a Postal Sector or Ward.

In some cases, groups of people living in an area only display slight variation, but spending
differences may be significant nevertheless. Mosaic is sufficiently diverse to identify these
nuances. Corporate Chieftains are part of a wider group of Mosaic types called Symbols of
Success – another type within Symbols of Success is Golden Empty Nesters. Although both
have similar income levels, they spend different amounts on different products. Corporate
Chieftains are likely to have higher mortgage repayments and spend more on technology and
clothing than Golden Empty Nesters, who are likely to spend more on holidays.

Using this method, we calculate the expenditure for every product category included in Retail
Planner for each small area. Clearly, differences in populations, Mosaic types and spending
breakdowns will provide a huge variation across these geographies.

9.5     SCALING TO TOTAL EXPENDITURE

The final stage of the process is to ensure that the total expenditure for all Wards, Postal Sectors
or Output Areas equals the total expenditure stated in the official National Accounts figures
from the Blue Book. This process is referred to as scaling and ensures that there is consistency
between Retail Planner estimates and Experian’s regular UK economics products, such as the
Regional Planning Service.
10.               Contact details
Bureau service

Email:               goad.sales@uk.experian.com
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                     0115 968 5580




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Sunita Bali          sunita.bali @uk.experian.com
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Stephen Adams        stephen.adams@uk.experian.com
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Eric McVittie        eric.mcvittie@uk.experian.com
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          Annex 1

Recent data and forecasts for
 values, volumes and prices
                                                                          DATA AND FORECASTS

                   Total Spending (£m 2006 Prices)                             Total Spending (Current Prices)                                     Prices Indices (2006=100)

                  Total                  Spending on Spending on           Total                   Spending on Spending on           Total                  Spending on   Spending on
            Consumer Spending on Convenience         Comparison       Consumer Spending on Convenience            Comparison    Consumer     Spending on    Convenience   Comparison
          Spending(1) Retail Goods            Goods       Goods    Spending(1) Retail Goods             Goods         Goods    Spending(1)   Retail Goods        Goods         Goods
1980           350007         103075          79113       37895          132128          60295          31373         28923           37.8           58.5          39.7          76.3
1981           349772         102310          78106       37831          146508          64401          33842         30559           41.9           62.9          43.3          80.8
1982           352273         103641          77411       39213          160266          69173          36140         33032           45.5           66.7          46.7          84.2
1983           366599         107638          78373       41777          175908          75134          38396         36739           48.0           69.8          49.0          87.9
1984           374399         110157          77598       44110          188586          80490          40481         40009           50.4           73.1          52.2          90.7
1985           388220         114123          78386       46849          205737          87276          42750         44525           53.0           76.5          54.5          95.0
1986           413502         120486          80383       50823          227812          95318          45439         49879           55.1           79.1          56.5          98.1
1987           435916         127034          82256       55016          250274        103306           47980         55326           57.4           81.3          58.3         100.6
1988           469051         133831          83806       59597          282777        112765           50776         61990           60.3           84.3          60.6         104.0
1989           485009         139458          85316       63258          310168        120971           54342         66630           64.0           86.7          63.7         105.3
1990           488563         141167          85381       64647          336265        129546           58619         70927           68.8           91.8          68.7         109.7
1991           480582         141434          84626       65342          358107        137134           62121         75013           74.5           97.0          73.4         114.8
1992           483061         145247          84708       68481          377780        143659           64011         79649           78.2           98.9          75.6         116.3
1993           496212         150239          85839       71948          399875        150188           66233         83955           80.6          100.0          77.2         116.7
1994           510055         157593          86902       77434          419825        157488           67577         89912           82.3           99.9          77.8         116.1
1995           518754         160848          86381       80584          441085        165139           69741         95398           85.0          102.7          80.7         118.4
1996           539138         168542          89355       85229          472711        177161           74633        102528           87.7          105.1          83.5         120.3
1997           558064         176074          90888       90746          501290        186809           76417        110393           89.8          106.1          84.1         121.7
1998           579342         183734          91563       96960          534153        196144           78501        117644           92.2          106.8          85.7         121.3
1999           606648         195679          94650      105288          567994        207046           82284        124763           93.6          105.8          86.9         118.5
2000           633662         207750          96558      114667          600826        216155           84254        131901           94.8          104.0          87.3         115.0
2001           653326         216921          95530      123743          632496        225806           85905        139901           96.8          104.1          89.9         113.1
2002           676833         232275          97397      136394          664562        238635           88298        150337           98.2          102.7          90.7         110.2
2003           697160         246311          99112      148067          697160        251230           91497        159734         100.0           102.0          92.3         107.9
2004           721434         261162         101606      159974          732531        262937           94290        168647         101.5           100.7          92.8         105.4
2005           732005         267667         102801      165134          760869        266235           96689        169547         103.9            99.5          94.1         102.7
2006           745737         277925         104255      173739          793675        275701          100657        175044         106.4            99.2          96.5         100.8
2007           769046         290350         107172      183178          838090        290350          107172        183178         109.0           100.0         100.0         100.0
2008           788619         300145         108858      191288          884614        301154          111901        189253         112.2           100.3         102.8          98.9
2009           797165         306336         109255      197153          921102        312045          116085        195960         115.5           101.9         106.3          99.4
2010           814894         316400         110136      206525          965882        326521          120437        206084         118.5           103.2         109.4          99.8
2011           838364         328133         111408      217265         1013296        341352          124361        216991         120.9           104.0         111.6          99.9
2012           863034         339557         112674      227750         1058953        354321          127635        226686         122.7           104.3         113.3          99.5
2013           887259         350471         113801      237909         1105166        366306          130664        235642         124.6           104.5         114.8          99.0
2014           910702         360947         114707      247914         1153003        378005          133589        244416         126.6           104.7         116.5          98.6
2015           933498         371227         115533      257857         1203660        390028          136691        253337         128.9           105.1         118.3          98.2
2016           955927         381425         116315      267822         1257877        402698          140037        262661         131.6           105.6         120.4          98.1
       (1) Including spending by foreigners
       Source: data - ONS (Consumer Trends September 2008) , forecast - Experian Business Strategies October 2008
                                     Annex 2

       CLASSIFICATION OF INDIVIDUAL
        CONSUMPTION BY PURPOSE
               (COICOP-HBS)
CLASSIFICATION OF INDIVIDUAL CONSUMPTION BY PURPOSE
(COICOP-HBS) Most Classes comprise either goods or services. Classes
containing goods are denoted by either (ND), (SD) or (D) indicating either
‘non durable’, ‘semi-durable) or ‘durable’ respectively. (S) denotes Classes
consisting of ‘services’. Some Classes contain both goods and services
because it is difficult to break them into goods and services. Such Classes
are usually assigned an (S) as the service component is considered to be
predominant. Based on the final COICOP classification as prepared by
OECD after consultation with Eurostat, UNSD and the national statistical
agencies of its Member countries, October 1998, approved in March 1999


00.     Total consumption expenditure

01.      FOOD AND NON-ALCOHOLIC BEVERAGES
01.1. Food
The food products classified here are those generally purchased for
consumption at home. The group thus excludes food products normally sold
for immediate consumption by hotels, restaurants, cafés, bars, kiosks, street
vendors, automatic vending machines, etc. (11.1.1). Also excluded are
cooked dishes to take away and the products of prepared-food suppliers and
catering contractors even if they are delivered to the customer's home
(11.1.1). Products sold specifically as pet foods are covered by (09.3.4).
01.1.1. Bread and cereals (ND)
01.1.1.1.      Rice
- Rice in all forms including rice prepared with meat, fish, seafood or
   vegetables.
   (d = kilo)
01.1.1.2.      Bread
- Bread and other bakery products such as crispbread, rusks, toasted
   bread, biscuits, gingerbread, wafers, waffles, crumpets, muffins and
   croissants.
   (d = kilo)
01.1.1.3.      Pasta products
- Pasta products in all forms including pasta products containing meat, fish,
   seafood, cheese or vegetables.
   (d = kilo)
01.1.1.4.     Pastry-cook products
- Pastry-cook products such as cakes, tarts, pies, quiches and pizzas.
01.1.1.5.        Other products
- Maize, wheat, barley, oats, rye and other cereals in the form of grains,
   flour or meal;
-   other products such as malt, malt flour, malt extract, potato starch,
    tapioca, sago, other starches, cereal preparations (cornflakes, oat flakes,
    etc.) and dietary products and culinary ingredients based on flour, starch
    or malt extract.
Includes: couscous and similar farinaceous products prepared with meat,
fish, seafood or vegetables (01.1.1.5); mixes and doughs for the preparation
of bakery products or pastry-cook products (01.1.1.5).
Excludes: meat pies (01.1.2); fish pies (01.1.3); sweetcorn (01.1.7)
01.1.2. Meat (ND)
01.1.2.1.      Fresh, chilled or frozen meat of bovine animals
   (d = kilo)
01.1.2.2.        Fresh, chilled or frozen meat of swine
   (d = kilo)
01.1.2.3.        Fresh, chilled or frozen meat of sheep and goat
   (d = kilo)
01.1.2.4.     Fresh, chilled or frozen meat of poultry
- chicken, duck, goose, turkey, guinea fowl, etc.
    (d = kilo)
01.1.2.5.     Dried, salted or smoked meat and edible meat offal
- Sausages, salami, bacon, ham, pâté, etc.
   (d = kilo)
01.1.2.6.     Other preserved or processed meat and meat
preparations
- Canned meat, meat extracts, meat juices, meat pies, etc.
   (d = kilo)
01.1.2.7.        Other fresh, chilled or frozen edible meat
- Hare, rabbit and game (antelope, deer, boar, pheasant, grouse, pigeon,
   quail, etc.);
- horse, mule, donkey, camel and the like.
   (d = kilo)
Includes: meat and edible offal of marine mammals (seals, walruses, whales,
etc. / 01.1.2.7) and exotic animals (kangaroo, ostrich, alligator, etc..), animals
and poultry purchased live for consumption as food.
Excludes: farinaceous products containing meat (01.1.1); frogs, land and sea
snails (01.1.3); soups containing meat (01.1.9); lard and other edible animal
fats (01.1.5).
01.1.3. Fish (ND)
01.1.3.1.      Fresh, chilled or frozen fish
   (d = kilo)
01.1.3.2.        Fresh, chilled or frozen seafood
- Crustaceans including land crabs, molluscs and other shellfish, land and
   sea snails, frogs
   (d = kilo)
01.1.3.3.        Dried, smoked or salted fish and seafood
   (d = kilo)
01.1.3.4.     Other preserved or processed fish and seafood and fish
and seafood preparations
- Canned fish and seafood, caviar and other hard roes, fish pies, etc.
   (d = kilo)
Includes: fish and seafood purchased live for consumption as food
Excludes: farinaceous products containing fish (01.1.1); fish soups (01.1.9)
01.1.4. Milk, cheese and eggs (ND)
01.1.4.1.       Whole milk
- Raw, pasteurised or sterilised.
   (d = litre)
01.1.4.2.      Low fat milk
- Raw, pasteurised or sterilised.
   (d = litre)
01.1.4.3.     Preserved milk
- Condensed, evaporated or powdered
   (d = kilo)
01.1.4.4.        Yoghurt
   (d = kilo)
01.1.4.5.        Cheese and curd
   (d = kilo)



01.1.4.6.      Other milk products
- Cream, milk-based desserts, milk-based beverages and other similar
   milk-based products.
   (d = kilo)
01.1.4.7.     Eggs
- Poultry eggs, egg powder and other egg products made wholly from
   eggs.
   (d = unit)
Includes: milk, cream and yoghurt containing sugar, cocoa, fruit or
flavourings, dairy products not based on milk such as soya milk
Excludes: butter and butter products (01.1.5)
01.1.5. Oils and fats (ND)
01.1.5.1.        Butter
- butter oil, ghee, etc.
   (d = kilo)
01.1.5.2.       Margarine and other vegetable fats
- Including “diet” margarine and peanut butter.
   (d = kilo)
01.1.5.3.        Olive oil
   (d = litre)
01.1.5.4.        Edible oils
- Corn oil, sunflower-seed oil, cotton-seed oil, soybean oil, groundnut oil,
   walnut oil, etc.
   (d = litre)
01.1.5.5.        Other edible animal fats
- Lard, etc.
   (d = kilo)
Excludes: cod or halibut liver oil (06.1.1).
01.1.6. Fruit (ND)
01.1.6.1.       Citrus fruits (fresh, chilled or frozen)
- Orange, lemon, mandarin, grapefruit, etc.
   (d = kilo)
01.1.6.2.        Bananas (fresh, chilled or frozen)
   (d = kilo)
01.1.6.3.        Apples (fresh, chilled or frozen)
   (d = kilo)
01.1.6.4.        Pears (fresh, chilled or frozen)
   (d = kilo)
01.1.6.5.      Stone fruits (fresh, chilled or frozen)
- Apricot, plum, peach, avocado, cherry, etc.
   (d = kilo)
01.1.6.6.     Berries (fresh, chilled or frozen)
- Grapes, strawberry, etc.
   (d = kilo)
01.1.6.7.      Other fresh, chilled or frozen fruits
- Other tropical fruits, melon, water melon, etc.
   (d = kilo)
01.1.6.8.        Dried fruit
- including fruit peel, fruit kernels, nuts and edible seeds.
   (d = kilo)
01.1.6.9.      Preserved fruit and fruit-based products
- dietary preparations and culinary ingredients based exclusively on fruit.
   (d = kilo)
Excludes: vegetables grown for their fruit such as tomatoes, cucumbers and
aubergines (01.1.7); jams, marmalades, compotes, jellies, fruit purees and
pastes (01.1.8); parts of plants preserved in sugar (01.1.8); fruit juices
(01.2.2); fruit concentrates and syrups for culinary use (01.1.9) or for the
preparation of beverages (01.2.2).
01.1.7. Vegetables (ND)
01.1.7.1.      Leaf and stem vegetables(fresh, chilled or frozen)
- Lettuce, chicory, endive, celery, cress, spinach, parsley, fennel, etc.
01.1.7.2.      Cabbages (fresh or chilled)
- Brocolis, cauliflower, etc.
   (d = kilo)
01.1.7.3.     Vegetable grown for their fruit (fresh, chilled or frozen)
- Cucumber, tomato, aubergine, courgette, sweetcorn, beans, green
   pepper, pummkins etc.
   (d = kilo)
01.1.7.4.         Root crops, non-starchy bulbs and mushrooms (fresh,
chilled or frozen)
- Carrot, beet root, radish, turnip, onion, parsnips, leek, asparagus,
   articoke, etc.
   (d = kilo)
01.1.7.5.        Dried vegetables
   (d = kilo)
01.1.7.6.      Other preserved or processed vegetables
- vegetable-based products, dietary preparations and culinary ingredients
   based exclusively on vegetables.
   (d = kilo)
01.1.7.7.        Potatoes
   (d = kilo)
01.1.7.8.     Other tubers and products of tuber vegetables
- Manioc, arrowroot, cassava, sweet potatoes and other starchy roots;
-   flours, meals, flakes, purees, chips and crisps including frozen
    preparations such as chipped potatoes.
    (d = kilo)
Includes: olives, garlic, pulses, sweetcorn, sea fennel and other edible
seaweed, mushrooms and other edible fungi (01.1.7.4)
Excludes: potato starch, tapioca, sago and other starches (01.1.1); soups,
broths and stocks (01.1.9); ginger, pimento and other spices and
condiments, culinary herbs (parsley, rosemary, thyme, etc.) (01.1.9);
vegetable juices (01.2.2)
01.1.8. Sugar, jam, honey, chocolate and confectionery (ND)
01.1.8.1.       Sugar
- Cane or beet sugar, unrefined or refined, powdered, crystallised or in
   lumps.
   (d = kilo)
01.1.8.2.     Jams, marmalades
- Including compotes, jellies, fruit purees and pastes, natural and artificial
   honey.
   (d = kilo)
01.1.8.3.       Chocolate
- In bars or slabs.
   (d = kilo)


01.1.8.4.    Confectionery products
- Chewing gum, sweets, toffees, pastilles and other.
01.1.8.5.      Edible ices and ice cream
- Including sorbet.
   (d = litre)
01.1.8.6.     Other sugar products
- Syrups and molasses, including parts of plants preserved in sugar;
- Cocoa-based foods and cocoa-based dessert preparations;
Includes: artificial sugar substitutes (01.1.8.1)
Excludes: : cocoa and chocolate-based powder (01.2.1); syrups for the
preparation of beverages (01.2.2).
01.1.9. Food products n.e.c. (ND)
01.1.9.1.      Sauces, condiments
- Seasonings (mustard, mayonnaise, ketchup, soy sauce, etc.), vinegar.
01.1.9.2.       Salt, spices and culinary herbs
- Salt, spices , ginger, pimento and culinary herbs (parsley, rosemary,
   thyme etc.).
01.1.9.3.       Baker's yeast, dessert preparations, soups
- homogenised babyfood and dietary preparations irrespective of the
   composition
- prepared baking powders, baker's yeast, dessert preparations, soup,
   broths, stocks, etc.
01.1.9.4.       Other food products n.e.c.
Excludes: milk-based dessert (01.1.4); soya milk (01.1.4); artificial sugar
substitute and cocoa-based dessert preparations (01.1.8).
01.2. Non-alcoholic beverages
The non-alcoholic beverages classified here are those generally purchased
for consumption at home. The group thus excludes non-alcoholic beverages
normally sold for immediate consumption by hotels, restaurants, cafés, bars,
kiosks, street vendors, automatic vending machines, etc. (11.1.1).
01.2.1. Coffee, tea and cocoa (ND)
01.2.1.1.       Coffee
- Whether or not decaffeinated, roasted or ground, including instant coffee,
   coffee extracts and essences and coffee substitutes.
   (d = kilo)
01.2.1.2.     Tea
- Including maté and other plant products for infusions.
   (d = kilo)
01.2.1.3.     Cocoa and powdered chocolate
- Whether or not sweetened.
   (d = kilo)
Includes: preparations for beverages containing cocoa, milk, malt, etc.;
coffee and tea substitutes; extracts and essences of coffee and tea.
01.2.2. Mineral waters, soft drinks, fruit and vegetable juices (ND)
01.2.2.1.      Mineral or spring waters
   (d = litre)
01.2.2.2.      Soft drinks
- Such as sodas, lemonades and colas
   (d = litre)
01.2.2.3.      Fruit juices
- Includes syrups and concentrates for the preparation of beverages
   (d = litre)
01.2.2.4.        Vegetable juices
   (d = litre)
Includes: all drinking water sold in containers
Excludes: non-alcoholic spirits, liqueurs, etc. (02.1.1); non-alcoholic wine,
cider, etc. (02.1.2) and non-alcoholic beer (02.1.3).
02.   ALCOHOLIC BEVERAGES, TOBACCO AND NARCOTICS
02.1. Alcoholic beverages
The alcoholic beverages classified here are those generally purchased for
consumption at home. The group thus excludes alcoholic beverages
normally sold for immediate consumption by hotels, restaurants, cafés, bars,
kiosks, street vendors, automatic vending machines, etc. (11.1.1).
The beverages classified here include low or non-alcoholic beverages, which
are generally alcoholic such as non-alcoholic beer.
02.1.1. Spirits (ND)
02.1.1.1.        Spirits and liqueurs.
- Mead; aperitifs other than wine-based aperitifs; non-alcoholic spirits,
   liqueurs, eaux-de-vie, etc.
   (d = litre)
02.1.2. Wine (ND)
02.1.2.1.      Wine from grape or other fruit
- Including cider and perry, fortified wine.
   (d = litre)
02.1.2.2.      Other
- Wine-based aperitifs, champagne and other sparkling wines, sake and
   the like.
   (d = litre)
Includes: non-alcoholic wine, etc.
02.1.3. Beer (ND)
02.1.3.1.       Beer
- All kinds of beer such as ale, lager and porter;
- including low-alcoholic beer and non-alcoholic beer,shandy.
   (d = litre)
02.2. Tobacco
02.2.1. Tobacco (ND)
02.2.1.1.     Cigarettes
   (d = unit)
02.2.1.2.       Cigars
   (d = unit)
02.2.1.3.       Other tobacco
- Pipe tobacco, chewing tobacco or snuff;
- cigarette tabacco and cigarette papers.
Includes: purchases of tobacco in cafés, bars, restaurants, service stations,
etc.
Excludes: other smokers' articles (12.3.2.)
02.3. Narcotics
02.3.1. Narcotics (ND)
02.3.1.1.      Narcotics
- Marijuana, opium, cocaine and their derivatives;
- other vegetable-based narcotics such as cola nuts, betel and betel nuts;
- other narcotics including chemicals and man-made drugs.
03. CLOTHING AND FOOTWEAR
03.1. Clothing
03.1.1. Clothing materials (SD)
03.1.1.1.      Clothing materials
- Fabrics of natural fibres, of man-made fibres and of mixtures of natural
   and man-made fibres.
Excludes: furnishing fabrics (05.2.1).
03.1.2. Garments (SD)
03.1.2.1.        Garments for men
Either ready-to-wear or made-to-measure, in all materials (including leather,
furs, plastics and rubber), for everyday wear, for sport or for work:
- capes, overcoats, raincoats, anoraks, parkas, blousons, etc.;
- jackets, trousers, waistcoats, costumes, tailored suits, etc.;
- shirts, blouses, pullovers, sweaters, cardigans, etc.;
- shorts, track suits, jogging, sweatshirt, leotards etc.;
- T-shirts, vests, underpants, socks, stockings, tights, knickers, girdles,
   corsets;
- pyjamas, night-shirts, housecoats, dressing gowns, bathrobes and
   swimsuits;
03.1.2.2.        Garments for women
Either ready-to-wear or made-to-measure, in all materials (including leather,
furs, plastics and rubber), for everyday wear, for sport or for work (same as
03.1.2.1);
- dresses, skirts;
03.1.2.3.        Garments for children (3 to 13 years) and infants (0 to 2
years)
Either ready-to-wear or made-to-measure, in all materials (including leather,
furs, plastics and rubber), for everyday wear or for sport (same as 03.1.2.2);
- brassières;
- babyclothes including babies' napkins made of fabric and babies' booties
   made of fabric.
Excludes: articles of medical hosiery such as elasticated stockings (06.1.2);
babies' napkins (12.1.3)
03.1.3. Other articles of clothing and clothing accessories (SD)
03.1.3.1.       Other articles of clothing and clothing accessories
- Ties, handkerchiefs, scarves, squares, gloves, mittens, muffs, belts,
   braces, aprons, smocks, bibs, sleeve protectors, hats, caps, berets,
   bonnets, crash helmets;
- sewing threads, knitting wools and accessories for making clothing such
   as buckles, buttons, press-studs, zip-fasteners, ribbons, laces, trimmings,
   etc.
Includes: gardening cloves and working gloves.
Excludes: gloves and other articles made of rubber (05.6.1); pins, sewing
and knitting needles,thimbles (05.6.1); protective headgear for sports (such
as those used in ice hockey, American football, baseball, cricket, cycling,
boxing, etc.) (09.3.2); other protective gear for sports such as life jackets,
boxing gloves, shin-guards, pads and padding, goggles, belts, etc. (09.3.2);
paper handkerchiefs (12.1.3); watches, jewellery, cufflinks, tie-pins (12.3.1);
walking sticks and canes, umbrellas, fans, key rings (12.3.2).
03.1.4. Cleaning, repair and hire of clothing (S)
03.1.4.1.      Cleaning, repair and hire of clothing
- Dry-cleaning, laundering and dyeing of garmnets;
- darning, mending, repair and altering of garments;
-   hire of garments.
Includes: total value of the repair services (that is, both the cost of labour and
the cost of materials are covered).
Excludes: material, threads, accessories, etc. purchased by household with
the intention of undertaking the repairs themselves (03.1.1) or (03.1.3); repair
of household linen and other household textiles (05.2.1);dry-cleaning,
laundering and dyeing of household linen and household textiles (05.6.2);
hire of household linen (05.6.2).
03.2. Footwear
03.2.1. Shoes and other footwear (SD)
03.2.1.1.       Footwear for men
- Including sports footwear suitable for everyday or leisure wear (shoes for
   jogging, cross-training, tennis, basket ball, boating, etc.);
- parts of footwear (heels, soles, etc.).
03.2.1.2.    Footwear for women
- Same as 03.2.1.1.
03.2.1.3.    Footwear for children (3 to 13 years) and infants (0 to 2
years)
- Same as 03.2.1.1.
Includes: gaiters, leggings and similar articles; accessories for footwear such
as shoetrees and stretchers.
Excludes: babies' booties made of fabric (03.1.2); orthopaedic footwear
(06.1.3); game-specific footwear (bowling shoes, football boots, golfing
shoes, running spikes, ski boots, footwear fitted with ice skates or rollers,
etc.) (09.3.2); shin-guards, cricket pads and other protective apparel for sport
(09.3.2).
03.2.2. Repair and hire of footwear (S)
03.2.2.1.        Repair and hire of footwear
- Repair of footwear, including shoe cleaning services;
- hire of footwear, except game-specific footwear (bowling shoes, football
   boots, golfing shoes, running spikes, ski boots, footwear fitted with ice
   skates or rollers, etc.) (09.4.1).
Includes:. total value of the repair services (that is, both the cost of labour
and the cost of materials are covered)
Excludes: parts of footwear, such as heels, soles, etc., purchased by
household with the intention of undertaking the repair themselves (03.2.1);
polishes, creams and other shoe-cleaning articles (05.6.1); repair (09.3.2) or
hire (09.4.1.) of game-specific footwear (ski boots, football boots, golfing
shoes and other such footwear fitted with ice skates, rollers, spikes, studs,
etc..)
04. HOUSING, WATER, ELECTRICITY, GAS AND OTHER FUELS
04.1. Actual rentals for housing
Rentals normally include payment for the use of the land on which the
property stands, the dwelling occupied, the fixtures and fittings for heating,
plumbing, lighting, etc., and, in case of a dwelling let furnished, the furniture.
Rentals also include payment for the use of a garage to provide parking in
connection with the dwelling. The garage does not have to be physically
contiguous to the dwelling; nor does it have to be leased from the same
landlord.
Rentals do not include payment for the use of garages or parking spaces not
providing parking in connection with the dwelling (07.2.4). Nor do they
include charges for water supply (04.4.1), refuse collection (04.4.2) and
sewerage collection (04.4.3); co-proprietor charges for caretaking,
gardening, stairwell cleaning, heating and lightning, maintenance of lifts and
refuse disposal chutes, etc. in multi-occupied buildings (04.4.4); charges for
electricity (04.5.1) and gas (04.5.2); charges for heating and hot water
supplied by district heating plants (04.5.5).
04.1.1. Actual rentals paid by tenants (S)
04.1.1.1.       Actual rentals paid by tenants
- Rentals actually paid by tenants or subtenants occupying unfurnished or
   furnished premises as their main residence.
Includes: payment for the use of the furniture in the case of dwellings let
furnished; payments by households occupying a room in a hotel or boarding
house as their main residence.
Excludes: rentals for garages or parking spaces not providing parking in
connection with the dwelling (07.2.4); accommodation services of
educational establishments and hostels (11.2.1) and of retirement homes for
elderly persons (12.4.1).
04.1.2. Other actual rentals (S)
04.1.2.1.      Other actual rentals
- Rentals actually paid for secondary residences.
Includes: payment for the use of the furniture in the case of dwellings let
furnished
Excludes: rentals for accommodation in holiday villages and holiday centres
(11.2.1); rentals for garages or parking spaces not providing parking in
connection with the dwelling (07.2.4).
04.2. Imputed rentals for housing
For coverage see note to (04.1) above.
04.2.1. Imputed rentals of owner-occupiers (S)
04.2.1.1.      Imputed rentals of owner-occupiers
- Imputed rentals of owners occupying their main residence.
04.2.2. Other imputed rentals (S)
04.2.2.1.       Imputed rentals of households housed free.
- For this item, the coverage is different than the original COICOP which
   includes rentals of households paying a reduced rental; this is not
   applicable for the HBS. This items contains only imputed rentals for
   household housed free.
04.2.2.2.        (Imputed rentals for secondary residences
Not applicable for the HBS.)

04.3. Maintenance and repair of the dwelling
Maintenance and repair of dwellings are distinguished by two features: first,
they are activities that have to be undertaken regularly in order to maintain
the dwelling in good working order; second, they do not change the
dwelling’s performance, capacity or expected service life.
There are two types of maintenance and repairs of dwellings: those which
are minor, such as interior decoration and repairs to fittings, and which are
commonly carried out by both tenants and owners; and those which are
major, such as replastering walls or repairing roofs, and which are carried out
by owners only.
Only expenditures which tenants and owner-occupiers incur on materials and
services for minor maintenance and repairs are part of individual
consumption expenditure of households. Expenditures which owner-
occupiers incur on materials and services for major maintenance and repairs
are not part of individual consumption expenditure of households.
Purchases of materials made by tenants or owner-occupiers with the
intention of undertaking the maintenance or repairs themselves should be
shown under (04.3.1). If, however, tenants or owner-occupiers pay an
enterprise to carry out the maintenance or repairs then the total value of the
service, including the costs of the materials used, should be shown under
(04.3.2).
04.3.1. Materials for the maintenance and repair of the dwelling (ND)
04.3.1.1.       Materials for the maintenance and repair of the dwelling
- Products such as paints and varnishes, renderings, wallpapers, fabric
   wall coverings, window panes, plaster, cement, putty, wallpaper pastes,
   etc., purchased for minor maintenance and repair of the dwelling. Small
   plumbing items (pipes, taps, joints, etc.) and surfacing materials (floor
   boards, ceramic tiles, etc.) are included.
Excludes: fitted carpets and linoleum (05.1.2); hand tools, door fittings,
power sockets, wiring flex and lamp bulbs (05.5.2); brooms, scrubbing and
dusting brushes and cleaning products (05.6.1); products used for major
maintenance and repairs (intermediate consumption) or for extensions and
conversions of dwellings (capital formation).
04.3.2. Services for the maintenance and repair of the dwelling (S)
04.3.2.1.        Services for the maintenance and repair of the dwelling
- Services of plumbers, electricians, carpenters, glaziers, painters,
   decorators, floor polishers, etc. engaged for the regular maintenance and
   repair of the dwelling. Covers the total value of the service, that is both
   the cost of labour and the cost of materials are included.
Excludes: separate purchases of materials made by households with
intention of undertaking the maintenance or repair themselves (04.3.1),
services engaged for major maintenance and repairs (intermediate
consumption) or for extensions and conversions of dwellings (capital
formation).
04.4. Water supply and miscellaneous services relating to the
dwelling
04.4.1. Water supply (S)
04.4.1.1.       Water supply
Includes: associated expenditure such as hire of meters, reading of meters,
standing charges, etc.
Excludes: drinking water sold in bottles or containers (01.2.2); hot water or
steam supplied by district heating plants (04.5.5).
04.4.2. Refuse collection (S)
04.4.2.1.       Refuse collection
- Refuse collection and disposal.
04.4.3. Sewerage collection (S)
04.4.3.1.    Sewerage collection
-   Sewerage collection and disposal. If the distinction between 04.4.2.1 and
    04.4.3.1 is difficult to make in terms of collection of data in the HBS, then
    group the total amount under 04.4.2.1.
04.4.4. Other services relating to the dwelling n.e.c. (S)
04.4.4.1.       Other services relating to the dwelling n.e.c.
- Caretaking, gardening, stairwell cleaning, heating and lighting,
   maintenance of lifts and refuse disposal chutes in multi-occupied
   buildings;
- security services
- snow removal and chimney sweeping.
Excludes: household services such as window cleaning, disinfecting,
fumigation and pest extermination (05.6.2) and bodyguard (12.7.1)
04.5. Electricity, gas and other fuels
04.5.1. Electricity (ND)
04.5.1.1.       Electricity
Includes: associated expenditure such as hire of meters, reading of meters,
standing charges, etc.
04.5.2. Gas (ND)
04.5.2.1.       Town gas and natural gas
04.5.2.2.       Liquefied hydrocarbons (butane, propane, etc.).
Includes: associated expenditure such as hire of meters, reading of meters,
storage containers, standing charges, etc.
04.5.3. Liquid fuels (ND)
04.5.3.1.       Liquid fuels
- Domestic heating and lighting oil.
04.5.4. Solid fuels (ND)
04.5.4.1.       Solid fuels
- Coal, coke, briquettes, firewood, charcoal, peat and the like.
04.5.5. Heat energy (ND)
04.5.5.1.       Hot water, steam and ice
- Hot water and steam purchased from district heating plants;
- ice used for cooling and refrigeration purposes.
Includes: associated expenditure such as hire of meters, reading of meters,
standing charges, etc.
05. FURNISHINGS, HOUSEHOLD EQUIPMENT AND ROUTINE
          MAINTENANCE OF THE HOUSE
05.1. Furniture and furnishings, carpets and other floor coverings
05.1.1. Furniture and furnishings (D)
05.1.1.1.       Furniture and furnishings
- Beds, sofas, couches, tables, chairs, cupboards, chests of drawers and
   bookshelves;
- lighting equipment such as ceiling lights, standard lamps, globe lights and
   bedside lamps;
- pictures, sculptures, engravings, tapestries and other art objects including
   reproductions of works of art and other ornaments;
- screens, folding partitions and other furniture and fixtures.
Includes: delivery and installation when applicable; base-mattresses, tatamis;
bathroom cabinets; baby furniture such as cradles, high-chairs and play-
pens; blinds with the exception of fabric blinds (05.2.1); camping and garden
furniture with the exception of sunshades (05.2.1); mirrors, candle-holders
and candlesticks.
Excludes: safes (05.3.1); ornamental glass and ceramic articles (5.4.1),
clocks (12.3.1); wall thermometers and barometers, carry cots and push-
chairs (12.3.2); work of art and antique furniture acquired primarily as stores
of value (capital formation)
05.1.2. Carpets and other floor coverings (D)
05.1.2.1.      Carpets and other floor coverings
- Loose carpets, fitted carpets, linoleum and other such floor coverings.
Includes: laying of floor coverings.
Excludes: bathroom mats, rush mats and door mats (05.2.1); antique floor
coverings acquired primarily as stores of value (capital formation).
05.1.3. Repair of furniture, furnishings and floor coverings (S)
05.1.3.1.         Repair of furniture, furnishings and floor coverings
Includes: total value of the service (that is, both the cost of labour and the
cost of materials are covered); restoration of works of art, antique furniture
and antique floor coverings other than those acquired primarily as stores of
value (capital formation)
Excludes: installation (05.1.1) or (05.1.2), separate purchases of materials
made by households with the intention of undertaking the repair themselves
(05.1.1) or (05.1.2); dry-cleaning of carpets (05.6.2.)
05.2. Household textiles
05.2.1. Household textiles (SD)
05.2.1.1.         Household textiles
- Furnishing fabrics, curtains, double curtains, awnings, door curtains and
   fabric blinds;
- bedding such as mattresses, futons, pillows, bolsters and hammocks;
- bed linen such as sheets, pillowcases, blankets, travelling rugs, plaids,
   eiderdowns, counterpanes and mosquito nets;
- table and bathroom linen such as tablecloths and napkins, towels and
   face-cloths;
- other household textiles such as shopping bags, laundry bags, shoe
   bags, covers for clothes and furniture, flags, sunshades, etc.;
- repair of household textiles.
Includes: cloth bought by the piece; oilcloth; bathroom mats, rush mats and
door mats.
Excludes: fabric wall coverings (04.3.1); tapestries (05.1.1); floor coverings
such as carpets and fitted carpets (05.1.2); electric blankets (05.3.2); hire of
household linen (05.6.2); covers for motor cars, motor cycles, etc. (07.2.1);
air mattresses and sleeping bags (09.3.2).
05.3. Household appliances
05.3.1. Major household appliances whether electric or not (D)
05.3.1.1.       Refrigerators, freezers and fridge-freezers
05.3.1.2.       Clothes washing machines, clothes drying machines
and dish washing machines
- Including ironing and pressing machines.
05.3.1.3.       Cookers
- Including spit roasters, hobs, ranges, ovens and micro-wave ovens.
05.3.1.4.       Heaters, air conditioners
- Air conditioners, humidifiers, space heaters, water heaters, ventilators
   and extractor hoods.
05.3.1.5.     Cleaning equipment
- Vacuum cleaners, steam-cleaning machines, carpet shampooing
   machines and machines for scrubbing, waxing and polishing floors.
05.3.1.6.     Sewing and knitting machines
05.3.1.7.     Other major household appliances
- Such as safes, water softeners and drying cabinets.
Includes: delivery and installation of the appliances when applicable.
Excludes: such appliances that are built into the structure of the building
(capital formation).
05.3.2. Small electric household appliances (SD)
05.3.2.1.        Small electric household appliances
- Coffee mills, coffee-makers, juice extractors, can openers, food mixers,
   deep fryers, meat grills, knives, toasters, ice cream and sorbet makers,
   yoghurt makers, hotplates, irons, kettles, fans, household scales, electric
   blankets, etc.
Excludes: small non-electric household appliances and utensils, household
scales (05.4.1); personal weighing machines and baby scales (12.1.3).
05.3.3. Repair of household appliances (S)
05.3.3.1.        Repair of household appliances
Includes: total value of the service (that is, both the cost of labour and the
cost of materials are covered); charges for the leasing or rental of major
household appliances)
Excludes: separate purchase of materials made by households with the
intention of undertaking the repair themselves (05.3.1) or (05.3.2) installation
of major household appliances (05.3.1).
05.4. Glassware, tableware and household utensils
05.4.1. Glassware, tableware and household utensils (SD)
05.4.1.1.     Glass and crystal-ware, tableware
- For household, office and decoration.
- Household or toilet articles of porcelain, ceramic, stoneware, china, terra-
   cotta
05.4.1.2.       Cutlery, flatware and silverware
05.4.1.3.    Kitchen and domestic utensils
-   Non-electric kitchen utensils of all materials such as saucepans,
    stewpots, pressure cookers, frying pans, grills, coffee mills, purée-
    makers, mincers, hotplates, household scales and other such mechanical
    devices;
-   other household articles of all materials such as containers for bread,
    coffee, spices, etc., waste bins, waste-paper baskets, laundry baskets,
    portable money-boxes and strong-boxes, towel rails, bottle racks, irons
    and ironing boards, letter boxes, feeding bottles, thermos flasks and ice
    boxes.
05.4.1.4.        Repair of glassware, tableware and household utensils
Excludes: lighting equipment (05.1.1); electric household appliances (05.3.1)
or (05.3.2); cardboard tableware (05.6.1); personal weighing machines and
baby scales (12.1.3).
05.5. Tools and equipment for house and garden
05.5.1. Major tools and equipment (D)
05.5.1.1.       Major tools and equipment
- Motorised tools and equipment such as electric drills, saws, sanders and
   hedge cutters, garden tractors, motor-driven lawn mowers, cultivators,
   chain saws and water pumps;
- repair of these articles.
Includes: charges for the leasing or rental of do-it-yourself machinery and
equipment
05.5.2. Small tools and miscellaneous accessories (SD)
05.5.2.1.        Small tools and miscellaneous accessories
- Hand tools such as saws, hammers, wrenches, screwdrivers, spanners,
   pliers, trimming knives, raps and files;
- garden tools such as hand lawn mowers, wheel barrows, watering cans,
   hoses, spades, shovels, rakes, forks, scythes, sickles and secateurs;
- ladders and steps;
- door fittings (hinges, handles and locks), fittings for radiators and
   fireplaces and other metal articles for the house (curtain rails, carpet rods,
   hooks, etc.) or for the garden (chains, grids, stakes and hoop segments
   for fencing and bordering);
- small electrical accessories such as power sockets, switches, wiring flex,
   electric bulbs, fluorescent lighting tubes, torches, flashlights, hand-lamps,
   electric batteries for general use, bells and alarms;
- repair of these articles.
05.6. Goods and services for routine household maintenance
05.6.1. Non-durable household goods (ND)
05.6.1.1.        Cleaning and maintenance products
- Such as soaps, washing powders, washing liquid, scouring powders,
   detergents, disinfectant bleaches, softeners, conditioners, window-
   cleaning products, waxes, polishes, dyes, unblocking agents,
   disinfectants, insecticides, fungicides and distilled water;
05.6.1.2.        Other non-durable household articles
- Paper products such as filters, tablecloths and napkins, kitchen paper,
   vacuum cleaner bags and cardboard tableware, including aluminium foil
   and plastic bin liners;
- articles for cleaning such as brooms, scrubbing brushes, dust pans and
   dust brushes, dusters, tea towels, floorcloths, sponges, scourers, steel
   wool and chamois leathers;
- other non-durable household articles such as matches, candles, lamp
   wicks, methylated spirits, clothes pegs, hangers, sewing and knitting
   needles, thimbles, safety pins, nails, screws, nuts and bolts, drawing pins,
   tacks, washers, glues and adhesive tapes for household use, string, twine
   and rubber gloves.
Includes: polishes, creams and other shoe-cleaning articles.
Excludes: products for the upkeep of ornamental gardens (09.3.3); paper
handkerchiefs, toilet paper, toilet soaps and other products for personal
hygiene (12.1.3).
05.6.2. Domestic services and household services (S)
05.6.2.1.       Domestic services
- The employment of paid staff in private service such as butlers, cooks,
   maids, cleaners, drivers, gardeners, governesses, secretaries, tutors and
   au pairs;
- domestic services, including baby-sitting and housework, supplied by
   agencies or self-employed persons.
05.6.2.2.        Household services
- dry-cleaning, laundering and dyeing of household linen and household
   textiles and carpets;
- hire of furniture, furnishings, carpets, household equipment and
   household linen;
- other home care services such as window cleaning, disinfecting,
   fumigation and pest extermination.
Excludes: dry-cleaning, laundering and dyeing of garments (03.1.4);
payments by tenants of furnished accommodation for the use of furniture
(04.1.1) or (04.1.2); refuse collection (04.4.2); sewerage services (04.4.3);
caretaking, gardening, stairwell cleaning and lighting, maintenance of lifts
and refuse disposal chutes in multi-occupied buildings (04.4.4); security
services (04.4.4); snow removal and chimney sweeping (04.4.4); repair and
installation of furniture and floor coverings (05.1); repair and installation of
household appliances (05.3);removal and storage service (07.3.6); services
of wet-nurses, crèches, nurseries, day care centres and other child-minding
facilities (12.4.1); bodyguard (12.7.1).
06. HEALTH
Includes health services provided by school and university health centres.
06.1. Medical products, appliances and equipment
This group covers medicaments, prostheses, medical appliances and
equipment and other health-related products purchased by individuals, either
with or without a prescription, usually from dispensing chemists, pharmacists
or medical equipment suppliers.
They are intended for consumption or use outside a health facility or
institution. Such products supplied to out-patients by medical, dental and
paramedical practitioners or to in-patients by hospitals and the like are
classified in (06.2) or (06.3) as appropriate.
06.1.1. Pharmaceutical products (ND)
06.1.1.1.         Pharmaceutical products
- Medicinal preparations, medicinal drugs, patent medicines, serums and
    vaccines, vitamins and minerals, cod liver oil and halibut liver oil, oral
    contraceptives
Excludes: veterinary products (09.3.4); articles for personal hygiene such as
medicinal soaps (12.3.1)
06.1.2. Other medical products (ND)
06.1.2.1.      Other medical products
- Clinical thermometers, adhesive and non-adhesive bandages,
   hypodermic syringes, first-aid kits, hot-water bottles and ice bags, medical
   hosiery items such as elastic stockings and knee-supports, pregnancy
   test, condoms and other mechanical contraceptive devices.
06.1.3. Therapeutic appliances and equipment (D)
06.1.3.1.         Therapeutic appliances and equipment
- Corrective eye-glasses and contact lenses, hearing aids, glass eyes,
   artificial limbs and other prosthetic devices, orthopaedic braces and
   supports, orthopaedic footwear, surgical belts, trusses and supports, neck
   braces, medical massage equipment and health lamps, powered and
   unpowered wheelchairs and invalid carriages, “special” beds, crutches,
   electronic and other devices for monitoring blood pressure ;
- Repair of therapeutic appliances and equipment.
Includes: dentures but not fitting costs.
Excludes: hire of therapeutic equipment (06.2.3); protective goggles, belts
and supports for sport (09.3.2); sun-glasses not fitted with corrective lenses
(12.3.2)
06.2. Out-patient services
This group covers medical, dental and paramedical services delivered to out-
patients by medical, dental and paramedical practitioners and auxiliaries.
The services may be delivered at home or in individual or group consulting
facilities or dispensaries or the out-patient clinics of hospitals and the like.
The group includes the medicaments, prostheses, medical appliances and
equipment and other health-related products supplied to out-patients by such
practitioners and auxiliaries.
A distinction is made between the services provided by medical analyses
laboratories and X-ray centres and the services provided by medical and
dental practitioners. Usually it is the former who carry out the tests and take
the X-rays and the latter who interpret them. Fees for the taking of tests and
X-rays by medical analysis laboratories and X-ray centres are included under
(06.2.3); fees for interpretation are included under (06.2.2) and (06.2.1) as
appropriate. However, fees for medical analyses, such as cardiological and
echographical examinations, and X-rays, such as dental X-rays, which are
undertaken by medical and dental practitioners themselves are also included
under (06.2.1) or (06.2.2).
Medical, dental and paramedical services provided to in-patients by hospitals
and the like are covered by (06.3).


06.2.1. Medical Services (S)
06.2.1.1.      Medical Services
- Consultations of physicians in general or specialist practice.
Includes: services of orthodontic specialists.
Excludes: services of medical analysis laboratories and X-ray centers
(06.2.3); traditional medicine (06.2.3).
06.2.2. Dental services (S)
06.2.2.1.      Dental services
- Services of dentists, oral-hygienists and other dental auxiliaries.
Includes: fitting costs of dentures;
Excludes: dentures (06.1.3); services of orthodontic specialists (06.2.1);
services of medical analysis laboratories and X-ray centres (06.2.3).
06.2.3. Paramedical services (S)
06.2.3.1.       Services of medical analysis laboratories and X-ray
centres
06.2.3.2.       Services of medical auxiliaries
- Services of freelance nurses and midwives;
- Services of freelance acupuncturists, pedicures, chiropractors,
   optometrists, physiotherapists, speech therapists, etc.;
- Medically-prescribed corrective-gymnastic therapy;
- Out-patient thermal bath or seawater treatments.
06.2.3.3.       Other non-hospital services
- Ambulance services other than hospital ambulance services;
- Hire of therapeutic equipment.
Includes: traditional medicine.
06.3. Hospital services
Hospitalisation is considered to apply when the patient is accommodated for
the duration of the treatment. Hospital day care and home-based hospital
treatment are included as hospices for terminally-ill persons.
This group covers general and specialist hospitals as well as medical and
maternity centres and nursing and convalescence homes, which chiefly
provide in-patient services. It also covers the services of institutions serving
old people in which medical monitoring is an essential component and
rehabilitation centres providing in-patient health care and rehabilitative
therapy where the objective is to cure the patient rather than to provide long-
term support.
Hospitals are defined as institutions, which offer in-patient care under direst
supervision of qualified medical doctors. Medical centres, maternity centres,
nursing homes and convalescent home also provides in-patient care but their
services are supervised and frequently delivered by staff of lower
qualification then medical doctors.
The group does not cover facilities, such as medical cabinets, clinics and
dispensaries, devoted exclusively to out-patient care (06.2), retirement
homes for the elderly, institutions for disable persons and rehabilitation
centres providing primarily long-term support (12.4).
06.3.1. Hospital services (S)
06.3.1.1.        Hospital services
 These comprise the provision of the following services to hospital in-
   patients:
- Basic services: administration; accommodation; food and drink;
   supervision and care by non-specialist staff (nursing auxiliaries); first-aid
   and resuscitation; ambulance transport; provision of medicines and other
   pharmaceutical products; provision of therapeutic appliances and
   equipment.
- Medical services: services of physicians in general or specialist practice,
   of surgeons and of dentists; medical analysis and X-ray; paramedical
   services such as those of nurses, midwives, pedicures, chiropractors,
   optometrists, physiotherapists, speech therapists, etc.

07. TRANSPORT
07.1. Purchase of vehicles
Purchases of recreational vehicles such as camper vans, caravans, trailers,
aeroplanes and boats are covered by (09.2.1).
07.1.1. Motor cars (D)
07.1.1.1.       Purchase of new motor cars
- Motor cars, passenger vans, station wagons, estate car and the like with
   either two-wheel drive or four-wheel drive.
07.1.1.2.       Purchase of second hand motor cars
- Motor cars, passenger vans, station wagons, estate car and the like with
   either two-wheel drive or four-wheel drive.
Excludes: invalid carriages (06.1.3); camper vans (09.2.1); golf carts
(09.2.1).
07.1.2. Motor cycles (D)
07.1.2.1.        Motor cycles
- of all types, scooters and powered bicycles.
Includes: side cars; snowmobiles.
Excludes: invalid carriages (06.1.3); golf carts (09.2.1).
07.1.3. Bicycles (D)
07.1.3.1.      Bicycles
- and tricycles of all types, rickshaw, except toy bicycles and tricycles
   (09.3.1).
07.1.4. Animal drawn vehicles (D)
07.1.4.1.        Animal drawn vehicles
- animals required to draw the vehicles and related equipment (yokes,
   collars, harnesses, bridles, reins, etc..)
Excludes: horses and ponies, horse and pony drawn vehicles and related
equipment purchase for recreational purposes (09.2.1).
07.2. Operation of personal transport equipment
Purchases of spare parts, accessories or lubricants made by households
with the intention of undertaking the maintenance, repair or intervention
themselves should be shown under (07.2.1) or (07.2.2). If, however,
households pay an enterprise to carry out the maintenance, repair or fitting,
the total value of the service, including the costs of the materials used,
should be shown under (07.2.3).
07.2.1. Spare parts and accessories (SD)
07.2.1.1.    Spare parts and accessories
-   Tyres (new, used or retreaded), innertubes, spark plugs, batteries, shock
    absorbers, filters, pumps and other spare parts or accessories for
    personal transport equipment.
Includes: products specifically for the cleaning and maintenance of transport
equipment such as paints, chrome cleaners, sealing compounds and
bodywork polishes; covers for motor cars, motor cycles, etc.
Excludes: crash helmets for motor cycles and bicycles (03.1.3); non-specific
products for cleaning and maintenance such as distilled water, sponges,
chamois leathers, detergents, etc, (05.6.1); charges for the fitting of spare
parts and accessories and for the painting, washing and polishing of
bodywork (07.2.3); radio-telephones (08.2); car radios (09.1.1); baby-seats
for cars (12.3.2).
07.2.2. Fuels and lubricants (ND)
07.2.2.1.      Fuels and lubricants
- Petrol and other fuels such as diesel, liquid petroleum gas, alcohol and
   two-stroke mixtures;
- Lubricants, brake and transmission fluids, coolants and additives.
Includes: fuel for major tools and equipment covered under (05.5.1) and
recreational vehicles covered under (09.2.1).
Excludes: charges for oil changes and greasing (07.2.3).
07.2.3. Maintenance and repair of personal transport equipment (S)
07.2.3.1.       Maintenance and repairs
- Services purchased for the maintenance and repair of transport
   equipment such as fitting of parts and accessories, wheel balancing,
   technical inspection, breakdown services, oil changes, greasing and
   washing. Covers the total value of the service, that is both the cost of
   labour and the cost of materials used are included.
Excludes: separate purchase of spare parts, accessories or lubricants made
by household with the intention of undertaking the maintenance or repair
themselves (07.2.1) or (07.2.2); road worthiness test (07.2.4)
07.2.4. Other services in respect of personal transport equipment (S)
07.2.4.1.         Other services in respect of personal transport
equipment
- Hire of garages or parking spaces not providing parking in connection
   with the dwelling;
- toll facilities (bridges, tunnels, shuttle-ferries, motorways) and parking
   meters;
- driving lessons (cars or motor cycles), driving tests and driving licences;
- road worthiness test;
- hire of personal transport equipment without drivers.
Excludes: hire of a car with driver (07.3.2); services charges for insurance in
respect of personal transport equipment (12.5.4)
07.3. Transport services
Purchases of transport services are classified by mode of transport. When a
ticket covers two or more modes of transport - for example, intra-urban bus
and underground or inter-urban train and ferry - and the expenditure cannot
be apportioned between them, then such purchases should be classified in
(07.3.5).
Costs of meals, snacks, drink, refreshments or accommodation services
have to be included if covered by the fare and not separately priced. If
separately priced, these costs have to be classified in division 11.
School transport services are included, but ambulance services are excluded
(06.2.3)
07.3.1.      Passenger transport by railway (S)
07.3.1.1.      Passenger transport by railway
- Local and long-distance transport of individuals and groups of persons
   and luggage by train, tram and underground.
Includes: transport of private vehicles.
Excludes: funicular transport (07.3.6);
07.3.2. Passenger transport by road (S)
07.3.2.1.      Passenger transport by road
- Local and long distance transport of individuals and groups of persons
   and luggage by bus, coach, taxi and hired car with driver.
Excludes: ambulances (06.2.3) or (06.3.1)
07.3.3. Passenger transport by air (S)
07.3.3.1.       Passenger transport by air
- Transport of individuals and groups of persons and luggage by aeroplane
   and helicopter.
Excludes: ambulances (06.2.3) or (06.3.1)
07.3.4. Passenger transport by sea and inland waterway (S)
07.3.4.1.        Passenger transport by sea and inland waterway
- Transport of individuals and groups of persons and luggage by ship, boat,
   ferry, hovercraft and hydrofoil.
Includes: transport of private vehicles; accommodation services.
Excludes: ambulances (06.2.3) or (06.3.1)
07.3.5. Combined passenger transport (S)
07.3.5.1.     Combined passenger transport
- Transport of individuals and groups of persons and luggage by two or
   more modes of transport when the expenditure cannot be apportioned
   between them.
Includes: transport of private vehicles
Excludes: ambulances (06.2.3) or (06.3.1); package holidays (09.6.1);
07.3.6. Other purchased transport services (S)
07.3.6.1.      Other purchased transport services
- Funicular, chair lift and cable-car transport;
- removal and storage services;
- services of porters and left-luggage and luggage-forwarding offices;
- travel agents' commissions if separately prices.
Excludes: ambulances (06.2.3) or (06.3.1); teleferic, cable cars and ski lifts at
ski resorts and holiday centres (09.4.1).
            08. COMMUNICATION
08.1. Postal services
08.1.1. Postal services (S)
08.1.1.1.       Postal services
- Payments for the delivery of letters, postcards and parcels.
Includes: all purchases of new postage stamps, pre-franked postcards and
aerogrammes; private mail and parcel delivery.
Excludes: purchase of used or cancelled postage stamps (09.3.1); financial
services of post offices (12.6.2).
08.2. Telephone and telefax equipment
08.2.1. Telephone and telefax equipment (D)
08.2.1.1.       Telephone and telefax equipment
- Purchases of telephones, radio-telephones, telefax machines, telephone-
   answering machines and telephone loudspeakers;
- repair of such equipment.
Excludes: telefax and telephone answering facilities provided by personal
computers (09.1.3).
08.3. Telephone and telefax services
08.3.1. Telephone and telefax services (S)
08.3.1.1.       Telephone and telefax services
- Installation and subscription costs of personal telephone equipment;
- telephone calls from a private or public line;
- telegraphy, telex and telefax services;
- information transmission services.
Includes: radiotelephony, radiotelegraphy and radiotelex; telephone calls in
hotels, cafés or restaurants; hire of telephones, telefax machines, telephone
answering-machines and telephone loudspeakers; internet connection
services.
Excludes: purchases of telephones, telefax machines, telephone-answering
machines and telephone loudspeakers (08.2.1).
09. RECREATION AND CULTURE
09.1. Audio-visual, photographic and information processing
equipment
09.1.1. Equipment for the reception, recording and reproduction of
sound and pictures (D)
09.1.1.1.       Equipment for the reception, recording and
reproduction of sound
- Radio sets, car radios, radio clocks, two-way radios and amateur radio
   receivers and transmitters;
- gramophones, tape players and recorders, cassette players and
   recorders, CD-players, personal stereos, stereo systems and their
   constituent units (turntables, tuners, amplifiers, speakers, etc.),
   microphones and earphones.
09.1.1.2.      Television sets, video-cassette players and recorders
- Television aerials of all types;
Excludes: video cameras, camcorders and sound-recording cameras
(09.1.2); repair of such equipment (09.1.5); hire of such equipment, licence
fees and taxes on audio-visual equipment, subscriptions to private television
networks (09.4.2).
09.1.2. Photographic and cinematographic equipment and optical
instruments (D)
09.1.2.1.        Photographic and cinematographic equipment
- Still cameras, movie cameras and sound-recording cameras, video
   cameras and camcorders, film and slide projectors, enlargers and film
   processing equipment, and accessories such as screens, viewers,
   lenses, flash attachments, filters, and exposure meters.
09.1.2.2.      Optical instruments
- Binoculars, microscopes, telescopes and compasses.
09.1.3. Information processing equipment (D)
09.1.3.1.       Information processing equipment
- Personal computers and visual display units, printers, software and
   miscellaneous accessories accompanying them;
- calculators, including pocket calculators;
- typewriters and word processors.
Includes: telefax and telephone answering facilities provided by personal
computers.
Excludes: video game software, video game cassettes and game computers
to be plugged into a television set (09.3.1); typewriter ribbons (09.5.4); slide
rules (09.5.4).
09.1.4. Recording medias (D)
09.1.4.1.      Recording media for pictures and sound
- Records and compact discs;
- pre-recorded tapes, cassettes, video cassettes, diskettes and CD-ROMs
   for tape recorders, cassette recorders, video recorders and personal
   computers;
- unrecorded tapes, cassettes, video cassettes, diskettes and CD-ROMs
   for tape recorders, cassette recorders, video recorders and personal
   computers;
- unexposed films, cartridges and discs for photographic and
   cinematographic use.
Includes: photographic supplies such as paper and flash bulbs; unexposed
film the price of which includes the cost of processing without separately
identifying it.
Excludes: batteries (05.5.2); computer software (09.3.1), video game
software, cassettes or CD-ROMs (09.3.1); the development of films and the
printing of photographs (09.4.2).
09.1.5.      Repair of audio-visual, photographic and information
             processing equipment (S)
09.1.5.1.      Repair of audio-visual, photographic and information
processing equipment
- Repair of audio-visual equipment, photographic and cinematographic
   equipment, optical instruments and information processing equipment.
Includes: total value of the service (that is, both the cost of labour and the
cost of materials are covered)
Excludes: separate purchases of materials made by households with the
intention of undertaking the repair themselves (09.1.1) (09.1.2) or (09.1.3)
09.2. Other major durables for recreation and culture
09.2.1. Major durables for outdoor recreation (D)
09.2.1.1.      Major durables for outdoor recreation
- Camper vans, caravans and trailers;
- aeroplanes, microlight aircraft and gliders, hang-gliders and hot-air
   balloons;
- boats, outboard motors, sails, rigging and superstructures;
- horses and ponies, horse and pony drawn vehicles and related
   equipment (harnesses, bridles, reins, saddles, etc.);
- major items for games and sport such as canoes, kayaks, wind-surfing
   boards, body-building apparatus, sea-diving equipment, and golf carts;
Includes: fitting out of boats, campers vans, caravans, etc..
Excludes: horses and ponies, horse and pony drawn vehicles and related
equipment purchased for personal transport (07.1.4); inflatable boats, rafts
and swimming pools (09.3.2.)
09.2.2. Musical instrument and majors durables for indoor recreation
(D)
09.2.2.1.        Musical instruments
- Musical instruments of all size, including electronic musical instruments,
    such as pianos, organs, violins, guitars, drums, trumpets, clarinets, flutes,
    recorders, harmonica, etc..
09.2.2.2.       Majors durables for indoor recreation
- Billiard tables, ping-pong tables, pin-ball machines, gaming machines,
   etc.
Excludes: toys (09.3.1).
09.2.3. Maintenance and repair of other major durables for recreation
and culture (S)
09.2.3.1.       Maintenance and repair of other major durables for
recreation and culture
- Repair of camper vans, aeroplanes, boats, canoes, musical instruments,
   etc.
Includes : total value of the service(that is, both the cost of labour and the
cost of materials are covered); laying up for winter boats, camper-vans,
caravans, etc.; hanger services for private planes; marina services for boats
Excludes: fuel for recreational vehicles (07.2.2); separate purchases of
materials made by households with intention of undertaking the maintenance
or repair themselves (09.2.1) or (09.2.2); veterinary services (09.3.5).
09.3. Other recreational items and equipment, gardens and pets
09.3.1. Games, toys and hobbies (SD)
09.3.1.1.     Games, toys hobbies
-   Card games, parlour games, chess sets and the like;
-   toys of all kinds including dolls, soft toys, toy cars and trains, toy bicycles
    and tricycles, toy construction sets, puzzles, plasticine, electronic games,
    masks, disguises, jokes, novelties, fireworks and rockets, festoons and
    Christmas tree decorations;
-   stamp-collecting requisites such as used or cancelled postage stamps
    and stamp albums and other items for collections (coins, medals, mineral,
    zoological and botanical specimens, etc.), and other tools and articles
    n.e.c. for hobbies;
Includes: video game software, video game computers that plug into a
television set; video-games cassettes and video-game CD-ROMs.
Excludes: collectors' items falling into the category of works of art or antiques
(05.1.1); unused postage stamps (08.1.1); Christmas trees (09.3.3);
children's scrapbooks (09.5.1).
09.3.2. Equipment for sport, camping and open-air recreation (SD)
09.3.2.1.        Equipment for sport, camping and open-air recreation
- Gymnastic, physical education and sport equipment such as balls,
   shuttlecocks, nets, rackets, bats, skis, golf clubs, foils, sabres, poles,
   weights, discuses, javelins, dumb-bells, chest expanders and other body-
   building equipment;
- parachutes and other sky-diving equipment;
- firearms and ammunition for hunting, sport and personal protection;
- fishing rods and other equipment for fishing;
- equipment for beach and open-air games such as bowls, croquet, frisbee,
   volleyball and inflatable boats, rafts and swimming pools;
- camping equipment such as tents and accessories, sleeping bags, back-
   packs, air mattresses and inflating pumps, camping stoves and
   barbecues;
- repair of such articles.
Includes: game-specific footwear (ski boots, football boots, golfing shoes and
other such footwear fitted with ice skates, rollers, spikes, studs, etc.);
protective headgear for sports; other protective gear for sports such as life
jackets, boxing gloves, body padding, shin-guards, goggles, belts, supports,
etc.
Excludes: crash helmets for motor cycles and bicycles (03.1.3); camping and
garden furniture (05.1.1).
09.3.3. Gardens, plants and flowers (ND)
09.3.3.1.         Gardens, plants and flowers
- Natural or artificial flowers and foliage, plants, shrubs, bulbs, tubers,
   seeds, fertilisers, composts, garden peat, turf for lawns, specially treated
   soils for ornamental gardens, horticultural preparations, pots and pot
   holders.
Includes: natural and artificial Christmas trees; delivery charges for flowers
and plants.
Excludes: gardening gloves (03.1.3); gardening services (04.4.4) or (05.6.2);
gardening equipment (05.5.1); gardening tools (05.5.2).
09.3.4. Pets and related products (ND)
09.3.4.1.      Pets and related products
- Pets, pet foods, veterinary and grooming products for pets, collars,
   leashes, kennels, birdcages, fish tanks, cat litters, etc.
Excludes: horses and ponies (07.4.1) or (09.2.1); veterinary services
(09.3.5).
09.3.5. Veterinary and other services for pets (S)
09.3.5.1.       Veterinary and other services for pets
- Veterinary and other services for pets such as grooming, boarding,
   tattooing and training.

09.4. Recreational and cultural services
09.4.1. Recreational and sporting services (S)
09.4.1.1.       Recreational and sporting services
 Services provided by:
- sports stadia, horse-racing courses, motor-racing circuits, velodromes,
   etc.;
- skating rinks, golf courses, swimming pools, tennis courts, squash courts
   and bowling alleys, gymnasia, fitness center;
- fairs and amusement parks;
- roundabouts, see-saws and other playground facilities for children;
- pin-ball machines and other games for adults other than games of
   chance;
- ski slopes, ski lifts and the like;
- hire of equipment and accessories for sport and recreation, such as
   aeroplanes, boats, horses, skiing or camping equipment;
- out-of-school individual or group lessons in bridge, chess, aerobics,
   dancing, music, skating, skiing, swimming or other pastimes;
- services of mountain guides, tour guides, etc;
- navigational aid services for boating.
Includes: hire of game-specific footwear such as bowling shoes, football
boots, golfing shoes, running spikes, ski boots and footwear fitted with ice
skates, studs or rollers, etc.
Excludes: cable-car and chair-lift transport not at ski resorts or holiday
centres (07.3.6)
09.4.2. Cultural services (S)
09.4.2.1.        Cinemas, theatres, concerts
- Services provided by cinemas, theatres, opera houses, concert halls,
   music halls, circuses.
- Sound and light shows;
09.4.2.2.       Museums, zoological gardens and the like
- Services provided by museums, libraries, art galleries, exhibitions;
- Services provided by historic monuments, national parks, zoological and
   botanical gardens, aquaria;
09.4.2.3.       Television and radio taxes and hire of equipment
- Television and radio broadcasting, in particular licence fees for and
   subscriptions to television networks;
- hire of equipment and accessories for culture, such as television sets,
   video cassettes, etc.;
09.4.2.4.       Other services
- Services of musicians, clowns, performers for private entertainments;
- services of photographers such as developing, print processing,
   enlarging, portrait photography, wedding photography; etc.;
09.4.3. Games of chance (S)
09.4.3.1.        Games of chance
- For lotteries, bookmakers, totalisers, casinos and other gambling
   establishments, gaming machines, bingo halls, scratch cards,
   sweepstakes, etc (service charge is defined as the difference between
   the amounts paid for lottery tickets or placed in bets and the amounts
   paid out to winners).
09.5. Newspapers, books and stationery
09.5.1. Books (SD)
09.5.1.1.      Books
- Books, including atlases, dictionaries, encyclopaedias, text books,
   guidebooks and musical scores.
Includes: scrapbooks and albums for children, book binding.
Excludes: stamp albums (09.3.1).
09.5.2. Newspapers and periodicals (ND)
09.5.2.1.     Newspapers and periodicals
- Newspapers, magazines and other periodicals.
09.5.3. Miscellaneous printed matter (ND)
09.5.3.1.        Miscellaneous printed matter
- Catalogues and advertising material;
- posters, greeting cards and visiting cards, announcement and message
   cards, plain or picture postcards, calendars;
- road maps, world maps and globes.
Excludes: pre-franked postcards and aerogrammes (08.1.1); stamp albums
(09.3.1).



09.5.4. Stationery and drawing materials (ND)
09.5.4.1.       Stationery and drawing materials
- Writings pads, envelopes, account books, notebooks, diaries, etc.;
- pens, pencils, fountain pens, ball-point pens, felt-tip pens, inks, ink
   erasers, rubbers, pencil sharpeners, etc.;
- stencils, carbon paper, typewriter ribbons, inking pads, correcting fluids,
   etc.;
- paper punches, paper cutters, paper scissors, office glues and adhesives,
   staplers and staples, paper clips, drawing pins, etc.;
- drawing and painting materials such as canvas, paper, card, paints,
   crayons, pastels and brushes.
Includes: educational materials such as exercise books, slide rules,
geometry instruments, slates, chalks and pencil boxes.
Excludes: pocket calculators (09.1.3).
09.6. Package holidays
09.6.1. Package holidays (S)
09.6.1.1.      Package holidays
- All inclusive holidays or tours       which   provide   for   travel,   food,
   accommodation, guides, etc.
Includes: half-day and one-day excursion tours, pilgrimages.
10. EDUCATION
Covers educational services only. Does not include expenditures on
educational materials, such as books (09.5.1) and stationary (09.5.4), or
education support services, such as health care services (06), transport
services (07.3), catering (11.1.2) and accommodation (11.2.1).
It includes education by radio or television broadcasting.
The breakdown of educational services is based upon the level categories of
the 1997 International Standard Classification of Education (ISCED-97) of
the United Nations Educational, Scientific and Cultural Organisation
(UNESCO).
10.1. Pre-primary and primary education
10.1.1. Pre-primary and primary education (S)
10.1.1.1.      Pre-primary and primary education
- Levels 0 and 1 of ISCED-97: pre-primary and primary school.
Includes: literacy programmes for students too old for primary school.
10.2. Secondary education
10.2.1. Secondary education (S)
10.2.1.1.     Secondary education
- Levels 2 and 3 of ISCED-97: lower-secondary and upper-secondary
   education.
Includes: out-of-school secondary education for adults and young people.
10.3. Post-secondary non-tertiary education
10.3.1. Post-secondary non-tertiary education (S)
10.3.1.1.       Post-secondary non-tertiary education
- Levels 4 of ISCED-97: post-secondary non-tertiary education.
Includes: out-of-school post-secondary non-tertiary education for adults and
young people.
10.4. Tertiary education
10.4.1. Tertiary education (S)
10.4.1.1.       Tertiary education
- Levels 5and 6 of ISCED-97: first stage and second stage of tertiary
   education.
10.5. 10.5. Education not definable by level
10.5.1. Education not definable by level (S)
10.5.1.1.       Education not definable by level
- Educational programmes, generally for adults, which do not require any
   special prior instruction, in particular vocational training and cultural
   development.
Excludes: driving lessons (07.2.4); recreational, sport or tourist activities not
constituting organised, sustained and progressive training courses, for
example music, sport or bridge lessons given by independent teachers
(09.4.1).
11. RESTAURANTS AND HOTELS
11.1. Catering services
11.1.1. Restaurants, cafés and the like(S)
11.1.1.1.         Restaurants
- Catering services (meals, snacks, drinks and refreshments) provided by
   restaurants.
11.1.1.2.         Cafés, bars and the like
 Catering services (meals, drinks and refreshments) provided by cafés,
   buffets, bars, tea-rooms, etc.,         including those provided:
- in places providing recreational, cultural and sporting services: theatres,
   cinemas, sports stadia, swimming pools, sports complexes, museums, art
   galleries, etc.;
- on public transport (coaches, trains, boats, aeroplanes) except where the
   price of the meal is included in the fare (for example, a meal on an
   aeroplane);
- in places serving drinks in conjunction with entertainments: cabaret
   theatres, night clubs, dancing establishments with bars, etc.;
Also included are:


-   the sale of food products and beverages of immediate consumption by
    kiosks, street vendors and the like, including food products and
    beverages dispensed ready for consumption by automatic vending
    machines
-   the sale of cooked dishes by restaurants for consumption off their
    premises
-   the sale of cooked dishes by catering contractors whether collected by
    the customer or delivered to the customer's home.
Includes: tips.
Excludes: tobacco purchases (02.2.1), telephone calls (08.3.1).
11.1.2. Canteens (S)
11.1.2.1.       Canteens
- Catering services of works canteens, office canteens and canteens in
   schools, universities and other educational establishments.
Includes: university refectories, military messes and wardrooms.
Excludes: food and drink provided to hospital in-patients (06.3.1)
11.2. Accommodation services
11.2.1. Accommodation services (S)
11.2.1.1.       Accommodation services
- Accommodation services in hotels, boarding houses, motels, inns and
   establishments offering “bed and breakfast”;
- accommodation services of holiday villages and holiday centres, camping
   and caravan sites, youth hostels and mountain chalets;
- accommodation services of boarding schools, universities and other
   educational establishments.
- accommodation services of public transport (trains, boats, etc.) when
   priced separately.
- accommodation services of hostels for young worker or immigrants.
Includes: tips, porters.
Excludes: rentals of households occupying a room in a hotel or boarding
house as their main residence (04.1.1); rentals paid by households for
secondary residence for the duration of the holiday period (04.1.2);
telephone calls (08.3.1);catering services in such establishments except for
breakfast or other meals included in the price of the accommodation (11.1.1);
persons housed in orphanages, homes for the disabled or maladjusted
persons (12.4.1).
12. MISCELLANEOUS GOODS AND SERVICES
12.1. Personal care
12.1.1. Hairdressing salons and personal grooming establishments (S)
12.1.1.1.       Hairdressing salons and personal grooming
establishments
- Services of hairdressing salons, barbers, beauty shops, manicures,
   pedicures, Turkish baths, saunas, solariums, non-medical massages, etc.
Includes: bodycare, depilation and the like.
Excludes: spas (06.2.3) or (06.3.1); fitness centers (09.4.1).
12.1.2. Electrical appliances for personal care (D)
12.1.2.1.        Electrical appliances for personal care
- Electrical appliances: electric razors and hair trimmers, hand held and
   hood hair dryers, curling tongs and styling combs, sun-lamps, vibrators,
   electric tooth brushes and other electrical appliances for dental hygiene,
   etc.;
- Repair of such appliances
12.1.3. Other appliances, articles and products for personal care (ND)
12.1.3.1.       Other appliance, articles and products for personal care
- Non-electrical appliances: non-electrical razors and hair trimmers and
   blades therefor, scissors, nail files, combs, shaving brushes, hairbrushes,
   toothbrushes, nail brushes, hairpins, curlers, personal weighing
   machines, baby scales, etc.;
- articles for personal hygiene: toilet soap, medicinal soap, cleansing oil
   and milk, shaving soap, shaving cream and foam, toothpaste, etc.;
- beauty products, perfumes and deodorants: lipstick, nail varnish, make-up
   and make-up removal products (including powder compacts, brushes and
   powder puffs), hair lacquers and lotions, pre-shave and after-shave
   products, sun-bathing products, hair removers, perfumes and toilet
   waters, personal deodorants and bath products;
- other products: toilet paper, paper handkerchiefs, paper towels, sanitary
   towels, cotton wool, cotton tops, disposable babies' napkins.
Excludes: babies' napkins made of fabric (03.1.2); handkerchiefs made of
fabric (03.1.3).
12.2. Prostitution
12.2.1. Prostitution (S)
12.2.1.1.       Prostitution
- Services provided by prostitutes and the like.
12.3. Personal effects n.e.c.
12.3.1. Jewellery, clocks and watches (D)
12.3.1.1.       Jewellery, clocks and watches
- Precious stones and metals, jewellery fashioned out of such stones and
   metals, including costume jewellery, cuff-links and tie-pins;
- clocks, watches, stop-clocks, alarm clocks;
- repair of such articles.
Includes: travelling alarm clocks.
Excludes: ornaments (05.1.1) or (05.4.1); radio clocks (09.1.1); precious
stones and metals and jewellery fashioned out of such stones and metals
acquired primarily as stores of value (capital formation)
12.3.2. Other personal effects (SD)
12.3.2.1.       Travel goods and other carriers
- Suitcases, trunks, travel bags, attaché cases, satchels, hand-bags,
   wallets, purses, etc.
- repair of such articles.
12.3.2.2.       Other personal effects
- Articles for smokers: pipes, lighters, cigarette cases, cigar cutter, etc.;
- articles for babies: baby carriages, push-chairs, carry cots, recliners, car
   beds and seats, back-carriers, front carriers, reins and harnesses, etc.;
- miscellaneous personal articles; sun-glasses, walking sticks and canes,
   umbrellas and parasols, fans, key rings, etc.;
- funerary articles such as urns, coffins and gravestones.
- repair of such articles.
Includes: wall thermometers and barometers.
Excludes: baby furniture (05.1.1); shopping bags (05.2.1); feeding bottles
(05.4.1); pencil boxes (09.5.4).
12.4. Social protection
Social protection as defined here covers assistance and support provided to
persons who are: elderly, disabled, suffering from occupational injuries and
diseases, survivors (spouses and dependents of deceased persons),
unemployed and others (the destitute, the homeless, low-income earners,
indigenous persons, immigrants, refugees, alcohol and substance abusers,
etc.). It also covers assistance and support services provided to families and
children.
12.4.1. Social protection services (S)
12.4.1.1.         Social protection services
Households usually purchase social protection services, either wholly or in
part, for the elderly, the disabled and the family. Such services include
residential care, home help, day care and rehabilitation. More specifically,
this class covers payments by households for:
- Retirement homes for the elderly, residences for the disabled,
    rehabilitation centres providing long-term support for patients rather than
    health care and rehabilitative therapy, schools for the disabled where the
    main aim is to help students overcome their disability ;
- home cleaning services, meal programmes, day-care centres, day-care
    services and holiday-care services for the elderly and disabled;
- counselling, guidance, arbitration, fostering and adoption services for
    families.
12.4.1.2.        Crèches, nurseries
Service of wet-nurses, crèches, nurseries, play schools, kindergartens, day-
care centres and other child-minding facilities.
12.5. Insurance
Service charges for insurance are classified by type of insurance, namely:
life insurance and non-life insurance (that is, insurance in connection with the
dwelling, health, transport, etc.). Service charges for multi-risk insurance
covering several risks are not classified separately. For such insurance, if it
not possible to allocate the service charges to the various risks covered, the
service charges should be classified on the basis of the cost of the principal
risk.
12.5.1. (Life insurance
Not applicable for the HBS.)
12.5.2. Insurance connected with the dwelling (S)
12.5.2.1.        Insurance connected with the dwelling
- Charges paid by owner-occupiers and by tenants for the kinds of
   insurance typically taken out by tenants against fire, theft, water damage,
   etc.
Excludes: service charges paid by owner-occupiers for the kinds of
insurance typically taken out by landlords (intermediate consumption)
12.5.3. Insurance connected with health (S)
12.5.3.1.      Insurance connected with health
- Charges for sickness and accident insurance.
12.5.4. Insurance connected with transport (S)
12.5.4.1.      Insurance connected with transport
- Charges for insurance in respect of personal transport equipment;
- Charges for travel insurance and luggage insurance.
12.5.5. Other insurance (S)
12.5.5.1.         Other insurance
- Charges for other insurance such as civil liability for injury or damage to
   third parties or their property.
Excludes: civil liability damage to third parties or their property arising from
the operation of personal transport equipment (12.5.4.)
12.6. Financial services n.e.c.
12.6.1. (FISIM: Financial intermediation services indirectly measured
             Not applicable for the HBS.)
12.6.2. Financial services n.e.c. (S)
12.6.2.1.       Financial services n.e.c.
- Actual charges for the financial services of banks, post offices, saving
   banks, money changers and similar financial institutions;
- fees and service charges of brokers, investment counsellors, tax
   consultants and the like;
- administrative charges of private pension funds and the like.
12.7. Other services n.e.c.
12.7.1. Other services n.e.c. (S)
12.7.1.1.        Other services n.e.c.
- Fees for legal services, employment agencies, etc.;
- charges for undertaking and other funeral services;
- payment for the services of estate agents, housing agents, auctioneers,
   salesroom operators and other intermediaries;
- payment for photocopies and other reproductions of documents;
- fees for the issue of birth, marriage or death certificates;
- payment for newspaper notices and advertisements;
- payment for the services of graphologists, astrologers, private detectives,
   bodyguards, matrimonial agencies and marriage guidance counsellors,
   public writers, miscellaneous concessions (seats, toilets, cloakrooms),
   etc.

Functions 13 (Individual consumption expenditure by Non Profit Institutions
Serving Households (NPISH)) and 14 (Individual consumption expenditure
by general government) are not applicable for the HBS.




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