U.K. jewellery retailers post good sales despite VAT increase

The increase in VAT in U.K. from 17.5 percent to 20 percent post January 4, 2011, has not generated any drastic reactions by jewellery retailers so far, reports say. The retailers are not complaining, infact have noted a good sales period in January 2011.

Jewellery chain like Beaverbrooks, Mococo have recorded good footfalls and increased sales in January 2011, so far. The impact of Vat has not yet been felt in sales, for the jewellery retailers, reports suggest. Many are approaching various outlooks towards the VAT. While some retailers are swallowing the rise in prices, others are slowly increasing the prices of their products, while some say it is too early to tell if the VAT increase would affect short to medium term sales. Those in the affordable jewellery category are maintaining caution. Brands are looking now at slowly increasing prices on their own-brand lines and offering discounts where necessary.

Keeping customer goodwill as a priority in mind, some jewellery retailers are looking at either absorbing the extra VAT or offering discounts to customers.