Some parents are still spending large amounts of money on their children’s birthday parties despite the economic downturn, reports BBC News.

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So why are children’s parties so profitable? According to the BBC report, if 700,000 babies were born last year in the UK, and parents spent £50 on a party for each baby, there would be £35million spent on first birthdays alone. If parents paid for larger, glossier, commercially organised parties, the profits would be even higher.

“It's a huge industry. People spend an absolute fortune on their children's birthday parties and fortunately the recession hasn't affected our business,” Amanda Frolich, from of Amanda’s Action Kids, told a BBC business reporter.

Amanda charges up to £250 for a two-hour party, and she is hoping to franchise her approach to birthday parties.

For some parents, the feeling is one of having to compete with other parents’ expensive, commercially organised birthday parties. But are the parties being held because it’s what a young child would enjoy, or is it more about what the mums and dads would like to see?

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What do you think about expensive children’s parties? Let us know below...

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