Feb 13, 2017
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UK January sales shift online as footfall drops again

Feb 13, 2017

More evidence came Monday of the weakness of UK shopping in January as footfall tracking specialist Springboard said visitor traffic to stores dropped 1.3% year-on-year. That was the steepest drop in footfall since the 2.8% fall in June 2016 and lower than the three-month average of 0.8%.

Stores may not have been empty but reduced footfall meant they were quieter than a year ago last month

And it seems that none of the three destination categories Springboard follows had a good month. High streets were down 0.8%, retail parks dropped for the third consecutive month (a 0.4% drop looking particularly bad considering footfall rose 5.2% a year ago), and the existential issue facing shopping centres continued as they fell for the 12th consecutive month, this time by as much as 3%.

Springboard’s Insights Director Diane Wehrle saw the decline as a signal for a tough year:  “The 1.3% drop in footfall across the UK's bricks and mortar destinations in January may be a sign of tougher things to come in 2017. Not only was it a noticeably larger drop than the -0.2% in December; but it was the steepest decline since June 2016, when footfall was impacted in the preceding weeks and in the immediate aftermath of the EU referendum.”

The company, which produced the report in association with the British retail Consortium, said January had seen sluggish non-food sales that corresponded with the dip in footfall. The BRC said the footfall dip shows that physical stores bore the brunt of the sales slowdown as online was the preferred shopping channel for the month’s clearance sales.
Diane Wehrle also said the January results were also consistent with longer-term footfall trends, with an underperformance of shopping centres against high streets and retail parks.

And Springboard said that it is significant that footfall is correlating closely to retail sales, with all sales results published so far showing a poorer performance in January 2017 than in January 2016.

But the BRC had some upbeat news on the UK vacancy rate, which improved from 9.5% in October to 9.4% in January. It said that there is a trend from retail to hospitality that shows retail destinations “are adapting, with new occupiers offering a much demanded all round customer experience.”

Springboard has been one of the most vocal advocates in the past year of more shopping destinations mixing up their tenant offer to add extra dining/entertainment options. While this could increase competition for the best locations as fashion stores have to compete with restaurants, longer-term it should help attract more footfall to retail destinations.

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