Centres report the steepest drop amid stormy weather
Retailers in the UK faced a challenging end to 2024, as footfall across high streets, shopping centres, and retail parks dropped by 2.2% in December compared to the same month in 2023.
The decline has raised concerns about the overall performance during the critical Christmas trading period, as reported by the British Retail Consortium (BRC) and Sensormatic. Shopping centres were hit hardest, experiencing a 3.3% drop in visitors.
Helen Dickinson, chief executive of the BRC, described December as “drab”, marking the second consecutive year of declining visitor numbers: “Even the golden quarter, typically the peak of shopping activity, provided little relief, with footfall down over the period.” Adverse weather, including Storm Darragh and earlier disruptions from Storm Bert, further dampened in-person shopping, particularly in south-west England, Northern Ireland, Scotland, Wales, and northern England.
However, online shopping saw a boost, with Visa reporting a 6.1% increase in digital spending year-on-year during the seven weeks leading to December 20. Electronics and homeware purchases drove much of the online activity, while in-store clothing sales struggled. Some clothing and footwear retailers, including Quiz and Shoe Zone, had already issued profit warnings ahead of Christmas.
Supermarkets also reported mixed outcomes. Lidl UK recorded a 7% increase in festive sales, but analysts attributed part of this growth to a 3% expansion in store space, noting that real growth was more modest when adjusted to inflation.
Meanwhile, some grocers, such as Morrisons and Asda, grappled with operational challenges and heavy price competition, including discounts on vegetables as low as 8p per bag.
The hospitality sector fared slightly better, with sales up 2.7% during the week of December 16 compared to the same period in 2023, according to data from CGA and RSM. Bar chains benefited from the return of Christmas parties and extended bank holiday celebrations, but pubs recorded just 0.7% growth, falling behind inflation.
Economic uncertainty continues to weigh on consumer behaviour, with analysts noting cautious spending patterns despite improving real wages.
“Despite rising real UK living standards, the British shopper appears cautious, chiming with a weakening macroeconomic backdrop driven by the chancellor’s narrative and budget… the October budget seemed to take a lot of air out of the economy’s lungs,” Shore Capital analyst Clive Black said.
Major retailers such as Next, Sainsbury’s, Tesco, and Marks & Spencer are set to release their trading updates in early January, which will offer further insight into how they navigated the critical holiday season.
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