Customer footfall and retail sales improve despite looming cost of living crisis
Shopper footfall across the UK continued its gradual improvement in March, with many consumers enjoying their first full month without Covid restrictions.
While all UK stores saw higher footfall levels than at the start of the pandemic, shopping centers saw a significant improvement for the first time in 2022 as shoppers browsed multiple stores in preparation for the summer season, show figures from the British Retail Consortium (BRC)-Sensormatic IQ.
Total UK attendance was still down 15.4% in March from three years earlier, but an improvement of 1.2 percentage points from February and better than the three-month average drop of 15 .9%.
Footfall on main streets was down 17.8% from March three years ago, but 3.1 percentage points better than last month’s rate.
Shopping mall footfall rose 4.3 percentage points from last month’s rate.
BRC chief executive Helen Dickinson said: “March saw another gradual improvement in attendance levels across the UK. As the first full month without coronavirus restrictions in England and Northern Ireland, consumers were able to shop with a greater sense of normalcy, boosted by some spring sunshine.
“Many challenges loom on the horizon as consumer confidence has fallen to its lowest level in 16 months. Consumers are now feeling the effects of rising cost of living, rising food prices food and fuel, and also anticipate a rise in energy prices from 1 April.
“The impact on retail footfall and retail sales in stores and online is not yet visible, but as belts continue to tighten and prices continue to rise, the road will be difficult for consumers.”
Meanwhile, figures from business consultancy BDO also show the retail sector recording its 13th consecutive month of positive like-for-like sales, although non-store like-for-like sales fell for the third consecutive month.
However, BDO’s head of retail and wholesale, Sophie Michael, warned that some of this discretionary spending was being supported by record levels of household borrowing, and that there may be good reason to hold back. Expect a decline in these expenses over the next few months.
According to BDO’s High Street Sales Tracker, total comparable in-store and online sales rose 60.9% in March, compared to a base of 42.5% for the equivalent month last year.
The fashion and lifestyle categories saw substantial increases in total like-for-like sales, however, homeware saw its first decline since April 2020.
Ms Michael said: “Our March results highlighted that consumer spending remains elevated despite impending increases in the cost of living this month. However, there are worrying signs that some of this spending is being supported by record levels of household borrowing, which have been rising lately even as consumer confidence plummets.
“There may be good reason to expect some pullback in discretionary spending over the coming months, although the impact will inevitably vary across different areas of retail.”