Sarah Butler 

‘Drab December’ caps another year of declining footfall on UK high street

Visitor numbers at retail sites down 2.2% compared with 2023, raising fears of disappointing Christmas sales
  
  

A shopper holding a sale bag
Inclement weather over the festive period is thought to have played a part in the fall. Photograph: Martin Pope/SOPA Images/REX/Shutterstock

High streets and other shopping destinations have had a “drab December”, ending another year of falling visitor numbers and raising fears of disappointing sales in the most important month for retailers.

Attendance at UK shopping centres, retail parks and high streets was down 2.2% in December compared with the same period in 2023, according to data from the British Retail Consortium (BRC) and analysts at Sensormatic. The decrease was led by a 3.3% decline at shopping centres.

While footfall is no longer a clear guide to potential sales because of the increase in online shopping, the figures will add to anxieties about how retailers performed in the run-up to Christmas.

A swathe of industry trading statements revealing how the crucial period went starts on Tuesday with figures from the clothing and homewares chain Next, which is expected to have gained market share.

Sainsbury’s, Tesco and Marks & Spencer are also likely to have done well, but some clothing and footwear specialists are expected to have struggled, with Quiz and Shoe Zone both issuing profit warnings before Christmas.

Some food businesses, including Morrisons and Asda, are also thought to have faced difficulties amid some operational problems and heavy competition with some discounting of festive vegetables to as little as 8p a bag.

Lidl’s UK arm was the first retailer to reveal festive trading figures on Thursday, flagging a 7% rise in sales in the four weeks to Christmas Eve. However, Clive Black, an analyst at Shore Capital, said the discount supermarket chain had added 3% more space during the year so that underlying growth was likely to have been less than 4%. UK food inflation is running at about 2%.

Helen Dickinson, the BRC’s chief executive, said: “A drab December, which saw fewer shoppers in all locations, capped a disappointing year for UK retail footfall. This means 2024 is the second year in a row where footfall has been in decline.

“Even the golden quarter [the final three months of the year], typically the peak of shopping activity, provided little relief, with footfall down over the period. While the Black Friday weekend delivered more promising results, they were overshadowed by a lacklustre festive season.”

Weather had a impact, with Storm Darragh and a number of other climatic events keeping shoppers at home, particularly in south-west England and Northern Ireland in December, and in Scotland, Wales and the north of England – which were hit by Storm Bert in November.

The inclement conditions may have bolstered online sales. Figures from the credit and debit card provider Visa indicated a 2.3% rise in spending year on year during the seven weeks to 20 December, led by a 6.1% increase online. It said shoppers focused on electronics and homeware, with sales rising almost 7% in department stores and electronics sales up 1.3%, while clothing sales fell.

There were also signs of improvement for hospitality businesses with sales up 2.7% in the week from 16 December against the equivalent week in 2023, according to the hospitality business tracker from the advisory firms CGA and RSM. Bar chains did well thanks to the timing of bank holidays and the return of Christmas parties, but pubs experienced just 0.7% growth, behind inflation.

Kien Tan, a retail expert at PricewaterhouseCoopers, said: “Overall, and despite the rollercoaster footfall ride, we still expect a modestly positive Christmas for retail as a whole, albeit with inevitable winners and losers along the way.”

The relatively mild temperatures, concerns about the wider economy and prioritising of holidays after a wet and gloomy autumn are also thought to have held back spending on discretionary items such as clothing, large furniture and large household electrical goods.

Black said: “Despite rising real UK living standards, the British shopper appears cautious, chiming with a weakening macroeconomic backdrop driven by the chancellor’s narrative and budget … the October budget seemed to take a lot of air out of the economy’s lungs.”

He said the state of the labour market, interest rates and probably higher than hoped for levels of inflation were all likely to shape the retail scene this year.

 

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