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) Retail Planner Briefing Note 6.0 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: firstname.lastname@example.org Telephone: 0845 6016011 Sales enquiries Simon Sharpe email@example.com 0115 968 5580 Technical queries Sunita Bali sunita.bali @uk.experian.com 0203 042 4713 Stephen Adams firstname.lastname@example.org 0207 746 8219 1 Retail Planner Briefing Note 6.0 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. 2 Retail Planner Briefing Note 6.0 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. 3 Retail Planner Briefing Note 6.0 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. 4 Retail Planner Briefing Note 6.0 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 5 Retail Planner Briefing Note 6.0 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 6 Retail Planner Briefing Note 6.0 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 7 Retail Planner Briefing Note 6.0 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. 8 Retail Planner Briefing Note 6.0 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. 9 Retail Planner Briefing Note 6.0 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 10 Retail Planner Briefing Note 6.0 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. 11 Retail Planner Briefing Note 6.0 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. 12 Retail Planner Briefing Note 6.0 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. 13 Retail Planner Briefing Note 6.0 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 14 Retail Planner Briefing Note 6.0 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. 15 Retail Planner Briefing Note 6.0 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. 16 Retail Planner Briefing Note 6.0 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. 17 Retail Planner Briefing Note 6.0 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). 18 Retail Planner Briefing Note 6.0 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. 19 Retail Planner Briefing Note 6.0 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. 20 Retail Planner Briefing Note 6.0 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. 21 Retail Planner Briefing Note 6.0 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). 22 Retail Planner Briefing Note 6.0 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 23 Retail Planner Briefing Note 6.0 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. 24 Retail Planner Briefing Note 6.0 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. 25 Retail Planner Briefing Note 6.0 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. 26 Retail Planner Briefing Note 6.0 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. 27 Retail Planner Briefing Note 6.0 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. 28 Retail Planner Briefing Note 6.0 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. 29 Retail Planner Briefing Note 6.0 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 30 Retail Planner Briefing Note 6.0 £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. 31 Retail Planner Briefing Note 6.0 10. Contact details Bureau service Email: email@example.com Telephone: 0845 6016011 Sales enquiries Simon Sharpe firstname.lastname@example.org 0115 968 5580 Technical queries Sunita Bali sunita.bali @uk.experian.com 0203 042 4713 Stephen Adams email@example.com 0207 746 8219 Eric McVittie firstname.lastname@example.org 07969 499 751 32 Retail Planner Briefing Note 6.0 Annex 1 Recent data and forecasts for values, volumes and prices Retail Planner Briefing Note 6.0 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 Retail Planner Briefing Note 6.0 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; Retail Planner Briefing Note 6.0 - 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 Retail Planner Briefing Note 6.0 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) Retail Planner Briefing Note 6.0 (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; Retail Planner Briefing Note 6.0 - 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 Retail Planner Briefing Note 6.0 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). Retail Planner Briefing Note 6.0 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. Retail Planner Briefing Note 6.0 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; Retail Planner Briefing Note 6.0 - 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..) Retail Planner Briefing Note 6.0 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 Retail Planner Briefing Note 6.0 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) Retail Planner Briefing Note 6.0 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. Retail Planner Briefing Note 6.0 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 Retail Planner Briefing Note 6.0 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; Retail Planner Briefing Note 6.0 - 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. Retail Planner Briefing Note 6.0 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). Retail Planner Briefing Note 6.0 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 Retail Planner Briefing Note 6.0 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 Retail Planner Briefing Note 6.0 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 Retail Planner Briefing Note 6.0 - 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) Retail Planner Briefing Note 6.0 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). Retail Planner Briefing Note 6.0 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). Retail Planner Briefing Note 6.0 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. Retail Planner Briefing Note 6.0 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) Retail Planner Briefing Note 6.0 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). Retail Planner Briefing Note 6.0 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). Retail Planner Briefing Note 6.0 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. Retail Planner Briefing Note 6.0 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). Retail Planner Briefing Note 6.0 11. RESTAURANTS AND HOTELS 11.1. Catering services 11.1.1. Restaurants, cafés and the like(S) 188.8.131.52. Restaurants - Catering services (meals, snacks, drinks and refreshments) provided by restaurants. 184.108.40.206. 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) 220.127.116.11. 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) 18.104.22.168. 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); Retail Planner Briefing Note 6.0 persons housed in orphanages, homes for the disabled or maladjusted persons (12.4.1). Retail Planner Briefing Note 6.0 12. MISCELLANEOUS GOODS AND SERVICES 12.1. Personal care 12.1.1. Hairdressing salons and personal grooming establishments (S) 22.214.171.124. 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) 126.96.36.199. 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) 188.8.131.52. 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) 184.108.40.206. Prostitution - Services provided by prostitutes and the like. 12.3. Personal effects n.e.c. 12.3.1. Jewellery, clocks and watches (D) 220.127.116.11. 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) 18.104.22.168. Travel goods and other carriers - Suitcases, trunks, travel bags, attaché cases, satchels, hand-bags, wallets, purses, etc. - repair of such articles. Retail Planner Briefing Note 6.0 22.214.171.124. 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) 126.96.36.199. 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. 188.8.131.52. 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) 184.108.40.206. 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) Retail Planner Briefing Note 6.0 220.127.116.11. Insurance connected with health - Charges for sickness and accident insurance. 12.5.4. Insurance connected with transport (S) 18.104.22.168. 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) 22.214.171.124. 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) 126.96.36.199. 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) 188.8.131.52. 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.