The UK high street experienced a sales cold snap at the weekend as new figures showed footfall fell nearly 13 per cent nationwide while in shopping centres it slumped by a massive 50 per cent.
Poor weather, an early December spending spree and bank holiday trading hours deterred shoppers from venturing outdoors on New Year’s Day, as the retail sector suffered a portentous start to 2017.
Overall, footfall including in out of town retail parks fell by 23.8 per cent year-on-year, according to retail benchmarking firm Springboard Insights.
“The ease and comfort of online shopping proved too enticing for shoppers keen to snap up further discounts in the sales rather than bracing the cold outdoors,” said Diane Wehrle, a director at Springboard Insights.
She warned that more challenges lay ahead for many retailers, saying: “Retailers traditionally see the first trading weekend of the New Year as a sign of things to come, and if this still rings true the industry is set for a rocky 2017.”
However, veteran retail analyst Nick Bubb pointed out that a “calendar shift” partly explained the fall off in footfall. “The weekend obviously wasn’t fully comparable to last year, so they need to be taken with a pinch of salt, particularly given the continuing shift to online shopping,” he said.
“Given the increasing traffic congestion on the roads, there is every reason to expect that more people will opt for the convenience of online shopping in 2017 and that will further undermine high street footfall, at a time when consumers are going to be increasingly careful about how they spend their money, as real incomes come under pressure,” Bubb added.
The decline in New Year footfall came hot on the heels of lacklustre Boxing Day figures. There was a 7.3 per cent slide in footfall on 26 December which capped off “a disappointing couple of weeks for UK retail” according to Springboard.
This Wednesday, high street bellwether Next kicks off a raft of retailers’ Christmas trading results. It is expected to report positive fourth quarter sales growth of 2.3 per cent, reversing a 3.6 per cent contraction in the third quarter last year.
On 11 January, Sainsbury’s will be the first supermarket to update markets on trading. It will be followed by Tesco, Debenhams, and Primark-owner Associated British Foods on 12 January.
The challenges in the sector have been reflected in the share prices of some the UK’s best-known retailers which slumped during 2016. Sports Direct lost over 50 per cent of its value, Next was down over 30 per cent and Dixons Carphone fell 28 per cent.