Devaluation at Work

The trend began modestly enough as a sales-promotion stunt. Selfridges department store, Britain's equivalent of Macy's, teamed up with the Parisian magazine Elle to fly 100 French housewives to London free for a shopping weekend. It picked up speed soon after Britain's devaluation, which cut sterling prices by 14.3% in terms of francs, marks, dollars and other major currencies--enough to reduce a $32 coat to $27. By last week, with the added lure of January sales, the influx of foreign shoppers to London's West End stores had swelled to a torrent.

At Selfridges Oxford Street store, 48 interpreters struggled to cope with the crush of Continentals snapping up fashion garments, bedding, appliances, children's and men's wear. British European Airways put on extra flights, and Air France switched from 90-seat Caravelles to 180-seat Boeing 707 jets to help carry the bargain hunters. Harrods, the elegant Knightsbridge store, experienced a run on "everything English"--Liberty prints, fabrics, scarves, china and glass. Said Managing Director Alfred Spence: "We have known nothing like it in 50 years. Sales are up 171%."

Pity & Wonder. Though French matrons outnumbered those from other countries, many stores reported that hundreds of customers were flying in from Belgium, The Netherlands, West Germany, Scandinavia, and even Portugal and Poland. One U.S. boutique owner crossed the Atlantic to buy mod dresses on sale for $3.60, figuring that their London labels would enable her to charge $30 for them at home. Marveled the Daily Mail: "London has become an Anglo-Saxon version of an Eastern bazaar, where Continentals admire our traditional quality, pity our poverty, wonder aloud how we can do it at the price, and pay in currencies which make the pound look like a sick piaster."

The British also joined in the shopping spree--for quite a different reason. Devaluation has the effect of raising the cost of imports by almost 17%, and most Britons figure that price increases will soon spread from food and industrial raw materials to other segments of their economy. Moreover, many consumers anticipate that the government will soon raise purchase taxes and tighten restrictions on credit buying. Thus the British spending rush concentrated on carpets, furniture, appliances, and television sets as well as soft goods.

To keep the foreign hordes coming, the British railroads and the Grand Metropolitan hotel chain have added Paris, Brussels and Gothenburg, Sweden, to a "mini-weekend" shopping special that has already become a hit in Amsterdam. From The Netherlands, it offers travel by train and ferry, plus two days' lodging in London, for $37--less than a round-trip plane fare. Even better news for hard-pressed Britain is an upsurge in foreign orders for British autos. British Motor Corp. expects to increase its deliveries to Europe by 5,000 cars this month. To meet that demand, B.M.C. is switching one-third of its home-market production to export models.

This file is automatically generated by a robot program, so reader's discretion is required.