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UK retail footfall closer to 2019 levels but inflation "storm" coming

Thu, 7th Apr 2022 05:01

(Alliance News) - UK retail footfall moved closer to pre-pandemic levels in March, figures on Thursday showed, but with inflationary fears heating up, high streets could be an emptier place in April.

Figures from retail industry analysts Springboard showed UK retail footfall was just over 15% below 2019 levels in March. The gap was narrowed from just under a 21% decline in February.

Compared to pre-virus levels, shopping centre footfall was 21% lower, high street footfall was down 17% and visitor numbers in retail parks were 4.2% lower.

March's figure was close to November, when footfall was just under 15% lower.

"Despite the strong uplift in footfall in March, this is likely to be the calm before the storm, only offering some short term good news for retailers. With the substantial increase in energy and fuel prices, consumers are aware that increased costs are on the horizon but have not fully hit and so are already being relatively cautious, and the concomitant rise in inflation that is forecast over the forthcoming months will put household budgets under increasing pressure," Springboard analyst Diane Wehrle commented.

"Inevitably this will mean less disposable income and so some retail spending will be curtailed, particularly as we enter the summer period when many consumers will be looking to reserve budget to spend on much longed for summer holidays."

Although more workers have returned to offices in recent weeks, retailers must also adapt to hybrid working models. This could see large levels of home working continue, thereby reducing retail footfall, particularly in central locations.

Wehrle added: "With many employees opting to work at home for at least part of the week, the recovery in footfall – particularly in large city centres – has been constrained and is likely to remain so for the foreseeable future. At the same time, however, it should be recognised that not all of the drop in footfall is due to Covid; even prior to the pandemic Springboard's data had shown an average drop in footfall of around 1.5% per annum for the past decade as consumers migrated some of their spending online."

By Eric Cunha; ericcunha@alliancenews.com

Copyright 2022 Alliance News Limited. All Rights Reserved.

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