January: best retail footfall in two years

UK retail footfall in January was 1.2% up on a year ago, significantly above the 2.2% decline seen in December – and its best performance since January 2014, excluding Easter distortions.

Figures released by BRC (British Retail Consortium) and Springboard in their monthly monitor show that footfall in retail park locations increased 5.2% year-on-year – its best performance for two years. This is well ahead of December’s 2.1% rise and above the three-month average rate of 3%.

High streets reported their first rise in footfall since July 2013, excluding Easter distortions) – significantly ahead of December’s 4% decline.

Footfall growth in shopping centres was broadly flat in January – its best performance since January 2014.

The national town centre vacancy rate was 8.7% in January, down from the 9.1% rate reported in October 2015. This is the lowest reported rate since BRC and Springboard began reporting the data in July 2011.

BRC chief executive Helen Dickinson 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.

“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.

“So it is imperative that the chancellor capitalises on the conclusion of the review to introduce a system which flexes with economic conditions and leads to a substantially lower tax burden.”

Springboard marketing and insights director Diane Wehrle commented: “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.

“The improved vacancy rate is an encouraging sign, but there needs to be caution about being too optimistic, as evidence shows the driving force to be an increase in pop-ups and temporary lets in the run-up to Christmas and which are still occupied.

“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.”

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