The Wedding Economy

Prince Harry and Meghan Markle's wedding is already proving to be a cash bonanza for some UK businesses

Alberto Pezzali/NurPhoto via Getty Images

Running a bakery in a small, English town on the outskirts of London usually brings its fair share of quiet days.

But, for Edward Durkin's family-owned bakery, May 19 could well be the busiest day in its 100-year history.

Four generations on since his family first opened Heidi Bakery in a shopping mall opposite England's Windsor Castle in 1918, Durkin is in a prime position to take advantage of the marriage of Prince Harry and Meghan Markle.

"This is the biggest event in our bakery's history and we are taking full advantage of the day," Durkin told CNBC.

Local businesses in Windsor are already reaping the rewards that an influx of tourists — especially those from the U.S. — will bring to the Berkshire town.

"I don't think it's ever been as sustained and drawn as much international attention as much as this," Durkin said. "We remember William's and Kate's 2011 wedding, but that was in London. The real key is having the event in Windsor."

Location isn't the only advantage. The shopping mall which Heidi Bakery is located in has held a royal warrant, which gives his business official status as a supplier of gifts to Queen Elizabeth's household, for the best part of 20 years.

Edward Durkin (L) and Heidi Rolfe-Daniel (R), the great granddaughter of the department store's original founder
Heidi Bakery / Crest Comms
Edward Durkin (L) and Heidi Rolfe-Daniel (R), the great granddaughter of the department store's original founder

Durkin's royal connections run a little deeper. He fondly remembers the soon-to-be-wedded prince, along with his elder brother Prince William, regularly visiting his bakery after school with their friends when they were teenagers attending the nearby Eton College.

Home to both the queen's residence and Eton, famed for educating royalty and politicians including several prime ministers, Windsor's diminutive size may prove to be a headache for anyone trying to find accommodation for the big day.

"All of the hotels are full, so I'm envisaging the town is nearing full capacity," Durkin said.

Fully booked

When she arrived in London from Brazil in 2009, Jaciara Pereira never envisaged that she would capitalize on such a surge of interest in hotels. Her property rental business consists of 17 properties in Windsor and London. All are fully booked out the weekend of the royal wedding.

Tourists from countries including the U.S., India, Bangladesh and Argentina have spared no expense booking rooms in Notting Hill and Kensington, London's more expensive locations, so that they are able to commute into Windsor by train and soak up the atmosphere.

Pereira said the wedding has given her business such a financial boost that she has had to recruit more staff. It's a "win-win for all," she said.

"The royal family makes such a good impact. Families especially want to stay for short breaks, so I can see this boost continuing."

Paying a premium

With space at a premium in Windsor, London's luxury hotels have also capitalized. One hotelier is offering a "grand royal wedding package" for £3,500 ($4,873) per night for two people. The package includes afternoon tea, a royal wedding souvenir and a "360-degree view" of the capital's skyline.

And premium marketing isn't just the preserve of vacationers and hotels either. British pen-maker Yard O Led has launched a luxury silver pen and pencil set encrusted with Californian golden poppies, in what it has dubbed a homage to Markle's former life as a Hollywood actress. The firm described the product as offering a "delicate feminine appeal" — for the not-so-delicate price of £495 ($681).

Vacation packages with a royal wedding theme include a cruise ship company that is offering the opportunity to visit countries in southern Africa — a rumored honeymoon destination for the couple — including a trip to Victoria Falls, at the border of Zambia and Zimbabwe, and Johannesburg, South Africa.

Vacation packages with a royal wedding theme include a trip to Victoria Falls
Marka / UIG via Getty Images
Vacation packages with a royal wedding theme include a trip to Victoria Falls

Supermarket sweep

Big businesses too have jumped on the royal bandwagon.

For those on a budget, British supermarket Iceland has concocted a limited supply of a two-tier elderflower and lemon cake — replicating the royal couple's wedding cake.

Iceland's Head Chef Neil Nugent was given the task of "second guessing" the royal cake, adding what he called an "American spin" of buttercream and Sicilian lemon curd.

"I heard the announcement [of the type of cake] on the radio and immediately got texts from Iceland's owner asking to get a cake done that's as close to what the royals are getting," Nugent said.

With a turnaround of just three weeks, he's not overly worried about the £8 ($11) price tag that customers will have to pay, considering that Prince Harry and Meghan Markle's cake is rumored to have cost £65,000.

Scant promise

But, for all the positivity from businesses, May's royal wedding is unlikely to bring much of a boost to the wider U.K. economy, according to an analyst.

Yael Selfin, chief economist at global accounting firm KPMG, poured scorn on an estimate by tourist board Visit Britain that the wedding could boost the U.K. economy by up to £2 billion ($2.7 billion).

Beset by volatile household spending, squeezes on real incomes and uncertainty over Brexit, royal nuptials aren't enough to provide a much-needed bump.

However, Brexit could inadvertently play a hand in boosting Britain's tourism industry for the anticipated weekend.

"The relatively weak pound will encourage tourists, especially from the U.S., to visit the U.K. and they are also likely to be bigger spenders in the period," Selfin said.

Royal weddings have traditionally held back growth, as was the case for the marriage of Prince William and Kate Middleton in April 2011.

According to the U.K.'s Office for National Statistics, year-on-year gross domestic product (GDP) growth dropped after that wedding. For that occasion, however, productivity took a hit as a public holiday gave Britons a day off work, alongside the warmest April weather in a century.

Whatever the weather on May 19, Britons are sure to tuck into a slice of cake either watching wall-to-wall royal coverage or, for those avoiding it, the small matter of the FA Cup final soccer match.