Selfridges Reports 7% Sales Decline Citing End of UK Tax-Free Shopping

Selfridges reported a 7% decline in sales to £775 million in the 48 weeks ending January 4, 2025, attributing this drop primarily to the end of tax-free shopping for international tourists and weaker consumer confidence amid economic challenges. Despite narrowing losses from nearly £42 million to almost £16 million, the company has not achieved a pre-tax profit since 2019. The retailer noted that the removal of VAT-free shopping has deterred wealthy American and Asian tourists, who are now favoring other European cities like Paris and Milan for luxury purchases. Additional factors impacting sales included supply chain disruptions driven by global conflicts, inflation, exchange rate fluctuations, and rising energy costs. To counteract the downturn, Selfridges has invested in store refurbishments, expanded its membership program, and planned new exclusive shopping experiences such as the 40 Duke members club. Industry groups have urged the UK government to reinstate tax-free shopping, projecting it could add billions to the economy and help restore Britain's status as a global shopping destination.