A fall in footfall in July could mark a “sea change”in consumers’ willingness to spend, according to the latest British Retail Consortium (BRC) - Springboard Footfall and Vacancies Monitor.
Footfall in the month fell -1.1% against the prior year with high streets taking the biggest hit with footfall down -2.1%. Shopping centres were down -1.3% while retail parks were up 1.7%.
However it was the drop in footfall into the evening, which was down -0.5%, which indicated that shoppers could be tightening their purse strings on leisure activities, such as casual dining, as well as shopping, according to Springboard marketing and insights director Diane Wehrle.
“July’s results might well mark a sea change in consumers’ willingness to spend, as it was the first time since January that footfall dropped during both retail trading hours and into the evening,” Wehrle noted. “Over the last few months the growing importance of the leisure based trip has become a key part of the narrative when talking about retail destinations, but a -0.5% drop in footfall post 5pm in July is the first evidence of a tightening of purse strings on casual dining and leisure trips.”
From a regional perspective the East and South East were the only two regions that saw footfall growth in July, with the fastest growth in the East, which has now seen eight months of consecutive footfall growth. However East Midlands showed the fastest decline on the high street of all the regions at -4.7%.
Overall, the steepest decline in footfall in July occurred in the South West and Greater London, both showing a fall of -2.1%. Wales showed the first decline in seven months, at -0.9%, while Scotland saw a further decline from -0.2% in June to -0.4% July.
BRC CEO Helen Dickinson said that the overall footfall decline had a particularly negative impact on non-food sales (including fashion) as consumers cut back on non-essential items and noted that the relative success of retail parks could be down to the lower rents commanded by these locations versus town centres and high streets.
“The vacancy rate, now at its highest for a year, fails to brighten the picture for what was evidently a challenging month for retailers. Nearly one in 10 retail shops currently lie vacant and those in some vulnerable communities remain persistently empty, limiting the chances of these places to thrive,” she said.
“What’s more, September’s RPI which is expected to be in the region of 4%, represents a substantial increase in business rates for retailers in April 2018. So Government’s commitment to switch to CPI indexation should really be brought forward from 2020,” she added.
