BRITAIN’S high streets delivered their best overall footfall performance in two years last month, which is a sign that many consumers still value “bricks and mortar” retailers, according to the British Retail Consortium (BRC).
However, the BRC also called on Chancellor George Osborne to reduce retailers’ tax burden to help them stay competitive. The BRC/Springboard Footfall and Vacancies Monitor for January also provided evidence that the UK’s retail parks are still proving to be a hit with shoppers.
Footfall in January was 1.2 per cent up on a year ago, significantly above the 2.2 per cent decline seen in December, and its best performance since January 2014, excluding Easter distortions, according to the BRC. Footfall in retail park locations increased 5.2 per cent year-on-year, its best performance for two years, the survey said.
According to the BRC, the UK’s high streets reported their first rise in footfall since July 2013, excluding Easter distortions, and the January figure was significantly ahead of December’s 4.0 per cent decline. Footfall growth in shopping centres was broadly flat in January, its best performance since January 2014, the BRC said. The national town centre vacancy rate was 8.7 per cent in January 2016, down from the 9.1 per cent rate reported in October 2015.
“This is the lowest reported rate since we began reporting the data in July 2011,’’ the BRC said.
Helen Dickinson, BRC chief executive, said: “The improvement in shopper footfall witnessed in January provided a timely and welcome fillip to retailers at the start of the year, with retail parks once again recording a stellar performance.
“Indeed, this was the best overall footfall performance for two years, and well ahead of the three-month average.
“The further reduction in the shop vacancy rate is encouraging, more so against a backdrop in which online retailing is becoming increasingly popular.
But she added: “However, the fact remains that one in every 11 retail premises in our town centres lies empty.
“The current business rates system, in which rates bills only ever seem to rise, is wholly inadequate to the task ahead and so it is imperative that the Chancellor capitalises on the conclusion of the review next month to introduce a system which flexes with economic conditions and leads to a substantially lower tax burden.”
Diane Wehrle, marketing and insights director at research firm Springboard, said: “The increase in footfall across all retail destination types, the first since December 2011, alongside the rise in spending in January, finally demonstrates what is well known – that bricks and mortar shopping environments are still important to consumers.
“Tracking footfall across 450 individual locations since 2009 has shown that it is the post-5pm period that has been most resilient, with improvements in daytime footfall following on from an increase in activity in the evening.
“Spend on furniture, and hospitality, led the way, which potentially has longer-term benefits by increasing shoppers’ awareness of store offerings and driving up spend through longer dwell times and the family effect, whereby the family shopping group typically increases transactions values.”
Ms Wehrle said that the improved vacancy rate was an encouraging sign, but evidence suggests the driving force is an increase in pop-ups and temporary lets in the run up to Christmas, which are still occupied.
Ms Wehrle said: “However, the rationale for pop-ups for many retailers is an exploration of whether there is an appetite for the brand in that location; and an increase in footfall may encourage the conversion of a proportion of these into permanent occupancy, so improving the vacancy position into the next quarter.”