Retail footfall drops at worse rate in two years, BRC-Springboard finds

The number of shoppers at UK retailers in June dropped by sharpest rate in more than two years, as high street stores, shopping centres and retail parks all endured a difficult month.

During the five weeks 29 May to 2 July, footfall fell 2.8% compared to June last year, according to the British Retail Consortium (BRC) and Springboard, which said the marked deterioration from the small rise in May was the worst monthly decline for more than two years.

High streets shops reported a 3.7% fall in footfall, shopping centre footfall declined 2.3% and at retail parks it dropped 1.0%, which was the first time there all three areas had reported a decrease since December 2013.

Data released last week showed UK retail sales in June had decreased by 0.5% on a like-for-like basis and rose 0.2% on a total basis.

In the last three weeks of the month the drop in footfall averaged 4.1% compared with a 0.9% decline in the same weeks last year.

With such major political and economic news in June, plus sporting distractions from Euro 2016 to Wimbledon, there were plenty of excuses for the poorest footfall result for more than two years.

"The results are shaped by a political and economic storm against a backdrop of rain downpours and generally inclement weather throughout the whole month," said Springboard's marketing and insights director Diane Wehrle.

She noted that footfall deteriorated from a 0.4% rise in the first week of June to a 4.6% drop during the week of the referendum and a 3.4% drop in the weeks following, as consumer confidence was hit, despite retailers discounting throughout the period in early season sales.

“In the last three weeks of the month the drop in footfall averaged -4.1% compared with just -0.9% in the same weeks last year. Whilst the cooler more rainy weather than last year will explain some of this degradation in performance, it is unlikely that it will have accounted for all the 5% drop in footfall of across UK destinations in the seven days post the referendum."

"Most significant is the out-of-town footfall decline; the first drop since December 2013. It is more likely that consumers' attention was diverted in the immediate aftermath - the issue for retailers is how quickly shoppers will return to their usual patterns of behaviour."

Analysts at Shore Capital said they expect that, allowing for prevailing weather patterns, "there will be a gradual improvement in UK retail activity in July as folk 'get on with things'", possibly helped by a Bank of England rate reduction in August.