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New footfall figures reflect the changing nature of retail: BRC

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The changing role of the shop in today’s retail industry is reflected in new shopper numbers out today from the British Retail Consortium.

Overall visitor numbers fell by 1.6% in January, according to the BRC-Springboard Footfall and Vacancies Monitor for the month. That’s below the 12-month average of 0.7%. High street footfall was down by 1.9% over the period, from December 31 and January 27, recovering slightly from a three-month average fall of 2.1%, while shopping centre footfall fell by 3.1% in January – a sharper decline than the three-month average fall of 2.8%. But retail parks continued to buck the trend of decline, with visitor numbers up by 0.9%, better than the three month average of 0.2%.

Diane Wehrle, Springboard marketing and insights director, said the figures reflected wider use of retail parks in conjunction with online shopping.

She said: “A drop in footfall of -1.6% is an improvement on December’s -3.5%, but it is the worst result for January since 2013. So it is clear that the challenges facing bricks and mortar retailing are continuing to build – the -1.9% decline in high street footfall is more than double the -0.8% in January 2017 and shopping centre footfall continues to languish at -3.1% following a drop of -3% in January last year.

“In contrast activity in retail parks continues to grow, with a shift in footfall from -0.4% in January 2017 to +0.9% this January; despite furniture and household appliance sales in January being the worst of all 13 categories. Retail parks clearly now fulfil a wider role for shoppers; yes, they are convenient and functional shopping locations, but are buoyed by the continuing growth in online spending. Not only are they efficient click and collect points, but their attraction is enhanced by a wider offer, embracing hospitality. Herein lies the lesson for stores in urban locations of high streets and shopping centres; their longevity is contingent upon their ability to embrace all steps of consumers’ path to purchase, which implicitly necessitates a first class click and collect experience.”

At the same time, the national town centre vacancy rate was 8.9% in January 2018, down from 9.3% in October 2017. That was largely thanks to reduced vacancy rates for Greater London (now 5.6%, and down from 7.1% in October).

Helen Dickinson, chief executive of the BRC , said the changes reflected the changing shape of the retail industry.

“January painted a picture of divided fortunes with a slight improvement in town vacancy rates but decline in shopper footfall,” said Dickinson. “The latter fell in line with the underlying trend of reduced customer activity in shopping destinations, compounded by the squeeze on discretionary spending. Meanwhile retail sales continue to be buoyed by inflation, masking the lack of real growth.

“The more positive picture for vacancy rates over the last quarter is marginal. The Christmas trading period traditionally sees a boost in temporary lets, as landlords get creative with the flexible use of space to create pop-ups. This was particularly evident in London this year due to its denser physical retail offer. The long term trend is that vacancies remain stubbornly at around 9%, albeit much higher in many areas.

“If we look beyond the seasonal distortion, the pressures to rationalise and downsize store portfolios are continuing to build as structural and technological change gains momentum. Given that planning applications for new shops have fallen for the ninth year in a row, the mounting cost of property taxation will inevitably mean more empty shops on the high street.

“Retailing is about digital and face to face interactions with customers and how the different channels complement each other. Having a business tax system that works to support that, not undermine it, is what the country needs and what we remain committed to work in partnership with Government to deliver.”

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