High streets are continuing to suffer as shoppers saved on gifts and splashed their spare cash in restaurants and pubs in the days before Christmas.
The number of shoppers visiting UK stores slid 9% year on year on Monday and Tuesday, dashing hopes of a late rush to stores, according to analysts at Springboard.
Diane Wehrle, insights director at Springboard, said about 2% of the decline in shopper numbers was likely to be linked to the timing of Christmas Day, which is one day later in the week than last year.
The changing of shopping habits towards buying online and unseasonably balmy temperatures have also meant there is little demand for new coats, boots and knitwear. The Black Friday discount day in late November may also have eaten up sales.
“There is a downward movement in footfall anyway but we are seeing greater drops in the run-up to Christmas this year,” Wehrle said. “It’s partly because we have now got Black Friday and that has fed the habit to shop online. Retailers have gone hell for leather with with bargains but a lot of those will have been bought online for click & collect later.”
The poor shopper numbers will make grim reading for retailers who have been banking on a late rush this year. Bonmarché and Game Digital have already issued profit warnings as demand has failed to materialise this year and analysts expect more will follow.
Shares in Marks & Spencer slid earlier this week after analysts at Nomura predicted sales of clothing and homewares at established stores would slump 5.5% over the three months to the end of the year.
The retailer has been offering 30% off knitwear, one of its key seasonal ranges, since 10 December, as chains including Debenhams, Bhs, Dorothy Perkins, H&M and Gap have all got out their sale banners.
Veteran analyst Richard Hyman has predicted a shake-out in the new year, as shops count the cost of a lacklustre Christmas. “There’s a lot of zombie-looking, ailing retailers that are not long for this world,” he said.
High street stores are particularly suffering as shoppers switch to the internet. In-store spending slid 2.3% in the first 10 days of December according to Barclaycard, while online spending rose 9.4%, leaving overall spending virtually flat year on year.
However, Gordon McKinnon at Intu, which owns a string of shopping centres including the Trafford Centre in Manchester and the Metrocentre in Gateshead, said it had seen an uptick in visitor numbers from Monday after lull in the wake of Black Friday.
“The last 48 hours have been exceptionally busy at Intu,” he said. “With an extra shopping day this year in this final week before Christmas, we’ve witnessed consistently high footfall figures across our centres in the UK.
“Unsurprisingly, perhaps, large numbers of men are visiting our centres today having left things to the last minute and now desperately trying to strike off items on their Christmas shopping list.”
But the big winners are pubs and restaurants – where spending rose 18% and 16.4% respectively – as Barclaycard said the mild weather was encouraging people to go out more.
Discount stores are also getting a much bigger share of the pie. Spending in the likes of Lidl, Aldi and Poundland rose 6% in the first 10 days of December. Barclaycard, which processes nearly half of credit and debt card transactions in the UK, said this was largely to do with the proliferation of such stores rather than better performance from individual outlets.
With overall spending flat, there will be clear winners and losers this Christmas.
This article was written by Sarah Butler, for theguardian.com on Wednesday 23rd December 2015 18.13 Europe/Londonguardian.co.uk © Guardian News and Media Limited 2010