State of The Nation

A Spoonful Of Cautious Optimism

The future is bright, the future is greeting cards! Or is it?

PG gives the UK greeting card industry an annual health check.

Inset: The pulse of the greeting card industry remains strong.

Left: Boris Johnson’s briefings will hopefully not happen again, for many reasons! Below left: The UK public’s love and appreciation of greeting cards has grown ever stronger, being the ‘hug’ even when people could not physically embrace. This image is from the Cards for the Nation initiative driven by Fedrigoni, Hallmark and Cardzone which saw giant cards installed in several Cardzone shops in which consumers wrote their messages of thanks when the last lockdown started easing. Bottom: Throughout it all Rosie Made a Thing has been among the many UK publishers to have reflected the feelings and needs of the card buying public.

It was 17 December 2021 and Omicron cases in the UK looked to be spiralling out of control. There was speculation that there would be another lockdown, hospitals being unable to cope, another Christmas without social mixing and perhaps even retail restrictions.

It was on that day that exhibition organiser Clarion announced the postponement of the January Top Drawer until late February. There was even a question mark over the Spring Fair happening. Was 2022 going to be a carbon copy repeat of 2021? It was obviously a difficult decision. At that time Clarion, organisers of Top Drawer, were probably damned if they did cancel and damned if they didn’t!

Over a month later, the whole scenario has completely been transformed. The success of the booster jabs and the apparent milder new variant has led to many thinking that Covid is coming to an end. Covid will still be with us, but will probably be endemic rather than a pandemic with restrictions out the window.

There has been much written that the experience of the last two years has changed society for ever, but history tells us that it is human nature to move on and even forget mass illness. The 1918-1920 ‘Spanish’ flu killed tens of millions, but only led to subsequent modest changes. The many cases of fatal influenza in 1957 and 1968 tragically register as just footnotes in most history books. Ill health is always a very uncomfortable thing to dwell on.

So, although some trends have been enhanced during Covid times, like working from home (WFH) and increasing online sales, what settles as the ‘new normal’ is still not apparent, but wherever this may end up (with ramifications on card retailers and publishers) certainly, the sense of gloom that enveloped our industry this time last year has largely evaporated.

While the restrictions differed in Scotland and Wales, It is worth recalling that in England 2021 started with a four-month lockdown with all retail other than supermarkets and newsagents, forced to close. And that came on the back of a 2020 that had seen the Christmas sales period devastated by a month-long November lockdown and regional lockdowns in the week before Christmas. Spring Seasons greeting card sales were devastated for the second year in a row with supermarkets, newsagents, garden centres and online platforms being the only beneficiaries of greeting card sales from the public.

If that was not bad enough for the greeting card industry, publishers were hit by another blow in late January with Paperchase, one of our major retail chains going into administration, only to be miraculously revived, debt free and shorn of poor performing stores, in a pre-pack deal by private equity company Permira, with most greeting card publishers receiving a pittance of what they were owed by Paperchase. One particular and sad demise was another multiple retailer, Cards Galore which had enjoyed 30+ years with shops in London’s City, West End and

transport hubs. However, with the lockdowns, travel restrictions and working from home, it was on a hiding to nothing. But in contrast with the behaviour of certain other multiple retailers, the family-owned business did everything possible to alleviate the pain felt by suppliers - and at least is still trading, albeit from far fewer stores, from a much smaller estate, with former director Rumit Shah still part of the set up, working for the administrators.

These two business failures aside, 2021 certainly showed the UK greeting card industry to be robust, something borne out by ‘Resilience’ topping the charts in the PG Retail Barometer as the one-word indies felt best summed up our sector in the last year.

As retail and the economy picked up so did greeting card sales, with specialist card shops beginning the revival. Trade shows started up again, including Harrogate Home & Gift and a delayed PG Live in July, although by necessity they were shorn of international buyers. Even real physical awards events returned after a two-year absence with well attended Henries and Retas ‘dos’ while the GCA AGM and Conference in Manchester last October was a triumph.

And the BBC joined in the industry celebrations with its marvellous Christmas Special prime time Inside the Factory programme, being dedicated to the journey of a Christmas card through the camera lens of a Woodmansterne design.

But as the global economy revived, supply problems multiplied impacting on our industry. China, the manufacturer of so many greeting cards, had its own problems with localised lockdowns and labour shortages. The demand for raw materials pushed prices up and delivery times became longer and longer.

Compounding all this was a truly astonishing increase in Far East container shipping costs. The average price of a 40’ container rose from an average £2,500 to a peak of around £20,000. The reasons for this were unclear. ‘Cartel’ and ‘profiteering’ were words bandied about, but whatever the cause, the result was inflationary pressure and depays for many products.

But however damaging this was to publishers’ profit margins and mental health, the uncertainty and rumours of shortages on

shop shelves certainly helped give Christmas greeting card sales a very welcome early boost. In the end, although it was a close-run thing in many cases, most Far Eastern produced products did arrive in time to get on the shop shelves. And even the late Omicron scare did little to dampen sales for many card retailers, apart from those situated in large shopping malls, or city and town centres who were clobbered by the drop in footfall.

So, what of 2022 for the greeting card industry? There are reasons to be optimistic. For the first time in three years, we are on course for non-interrupted Spring Seasons greeting card industry events.

While ‘working from home’ will not disappear, more workers will start returning to offices leading to busier shopping centres, town, and city centres as well as shops in travel hubs.

Online greeting card sales which have boomed in the last two years are here to stay, but as research company Kantar clocked, greeting card purchases showed one of the strongest returns to ‘bricks and mortar’ than virtually all other consumer products, with people rediscovering the joys of physical shopping and fully appreciating the tactility and aesthetic triumph of greeting cards today.

Greeting card sending events like weddings, children’s birthday parties, family celebrations and dinner parties will all be back with a bang.

Spring Fair returns shortly after a twoyear absence, Top Drawer a few weeks afterwards while, with the easing of travel restrictions, the signs are that PG Live in June will see international buyers and distributors return to the London show.

Despite all these hopefully positive developments, there are concerns. On top of worries of paper shortages, inflation will continue to eat into publishers’ margins while the huge projected increase in energy bills and tax hikes due in April will no doubt affect that vital disposable income upon which the industry depends. But after all the disruptions the greeting card industry has experienced in the last two years these are the type of challenges we are well equipped to deal with. The last words go to Jo Parman, strategic insights director of the Worldpanel Plus team at research company, Kantar, who stressed to PG the key role greeting cards play in human behaviour. “There was a sense of emotional impetus driving change as people longed for connection to one another last year - the greeting card sector offered an important way for people to stay in touch and show they care from afar. We’re still facing challenging times and it will be interesting to see how that desire to show the special people in our lives how much they mean will convert into sales for greeting cards.”

The answer to this will determine the state of the greeting card nation in 2022!

Above: Harrogate Home & Gift last July was the first ‘real’ trade show since the start of 2020.. Below: Wendy and (right) Steve Jones-Blackett with Windles Bruce Podmore, sharing one of the many moments of joy at The Henries last October.