March bounce for footfall overshadowed by inflation storm

Retail footfall bounced back from the pits of Omicron in March, fresh industry data revealed on Thursday, though it was being viewed with caution as a possible calm before the inflationary storm.

According to retail analysts Springboard, the month delivered “encouraging news” for retailers, as footfall bounced back to sit 15.3% below the pre-Covid levels of 2019.

It described that as a “significant improvement” on February, when footfall was 20.7% below 2019.

The data was also just below November, when footfall was 14.5% below pre-Covid comparators, before the increase in infections due to the Omicron variant of the coronavirus.

Springboard said footfall improved in all three destination types, although high streets particularly benefited with an improvement of around a third to 17.4% below 2019, from 26.2% lower in February.

That saw high streets overtake shopping centres, where footfall remained steady at 21.4% below 2019.

The strong uplift in footfall in March was likely to only offer some short-term good news for retailers, however, in the face of increased energy and fuel prices and the concomitant rise in inflation.

Springboard said a reduction in disposable income would likely curtail retail spending in the coming months, exacerbated by demand from consumers for summer holidays.

“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,” said Springboard’s insights director Diane Wehrle.

“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.

“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.”