Retail footfall falls as consumers feel the heat, yet sales stable

The British Retail Consortium and Sensormatic IQ tracker of UK retail footfall and sales has recorded a 14.2% decline in traffic through stores in July versus pre-pandemic levels.

A steady drop off saw levels down 3.7% against June and comfortably below the three month average at 12.3% down.

Shopping centres were noticeable impacted to a sharper degree, with customer traffic just shy of 25% down on pre-pandemic levels. On the High Street, the three year benchmarking used to illustrate the trend outside of Covid’s anomaly has footfall 15.9% reduced and 2% down month-to-month.

Regionally there appeared a north-south divide as Scotland’s rates tailed off at 16.5%, versus England and Wales at 14% and 15.8%, respectively. Northern Ireland performed best at 12% down.

Somewhat blaming the heat for keeping consumers away from hot streets, Helen Dickinson OBE, Chief Executive at the BRC said: “Following four months of steady progress, UK footfall stalled in July as record temperatures and the rising cost-of-living deterred people from visiting local shops. There was some respite in the last week of July, ahead of the Women’s Euros finals, as people stocked up on food and drink to watch the Lionesses bring footfall home. Meanwhile, footfall in Northern Ireland bucked the UK trend and improved slightly on the previous month.

“A new Prime Minister offers a renewed opportunity for the Conservative Party to meet its 2019 pledge for fundamental reform of the broken Business Rates system. The first step is scrapping the ‘downwards phasing’ part of Transitional Relief – a flawed system that prevent retailers paying what they owe, and instead would force them to overpay more than £1 billion between 2023 and 2026. This money could be better used to help limit price rises for customers, curb the rising cost-of-living and invest in the vitality of towns and cities around the country.”

Sales hold, for now

Despite the increased absence of physical shoppers across the board total sales did maintain stability and in fact were 2.3% up in July when measured against last year’s figure (also a 6.4% rise).

Food sales drove some of the uptick, despite well documented cost increases, while non-food retail sales declined by 2% on a total basis and 2.5% on a like-for-like measurement.

Online non-food sales decreased 3.9% in July, which was above the three-month and 12-month average declines.

Dickinson said on the sales during summer so far: “Sales improved in July as the heatwave boosted sales of hot weather essentials. Summer clothing, picnic treats, and electric fans all benefitted from the record temperatures as consumers made the best of the sunshine. However, with inflation at over 9% many retailers are still contending with falling sales volumes during what remains an incredibly difficult trading period.

“Consumer confidence remains weak, and the rise in interest rates coupled with talk of recession will do little to improve the situation. The Bank of England now expects inflation to reach over 13% in October when energy bills rise again, further tightening the screws on struggling households. This means that both consumers and retailers are in for a rocky road throughout the rest of 2022.”

For an update specifically on bike retail sales trends, head to today’s round up.