Springboard has significantly adjusted its Christmas forecast downward in light of the latest English lockdown, deeming the impact on the retail industry as nothing short of “catastrophic.” Initially projecting a 32.7% decrease in footfall, the new lockdown measures have pushed this projection to a potentially devastating 62% drop from November 22 through December 26. High streets are anticipated to bear the brunt of this decline, with an estimated 87.3% decrease in foot traffic. Should the lockdown stretch into December, footfall could plummet even further, surpassing 80% and mirroring the levels observed during the peak of the pandemic in April.
Typically, retailers witness a steady increase in foot traffic as the holiday season approaches, starting from early November and rising by an average of 3% each week. The most significant surge usually occurs in December, with an average jump of 11.4% in the week leading up to Christmas. However, with the current lockdown measures in place, the retail sector is facing unprecedented challenges this festive season.
A recent survey conducted before the lockdown indicated that a substantial 61.2% of consumers intend to allocate more of their holiday spending towards online purchases, while only 20.4% are planning to visit physical stores. With the new restrictions looming, online shopping is anticipated to emerge as the predominant choice for consumers throughout November. Moreover, 63.5% of Britons are planning to scale back their Christmas expenditure this year, with only a small fraction looking to increase their gift-buying.
Given that Christmas Day falls on a Friday and Boxing Day on a Saturday this year, footfall on Boxing Day is also likely to experience a further decline, exacerbated by the ‘Rule of 6’ restrictions on social gatherings. Additionally, the survey highlighted a notable lack of enthusiasm for Black Friday among nearly half of the participants.
The uncertainty surrounding a potential extension of the lockdown beyond December 2 only adds to the myriad challenges faced by the retail industry. With the surge in online sales and limitations on social interactions, the holiday season presents formidable obstacles for retailers. Springboard’s revised forecast serves as a stark reminder of the extensive ramifications of the ongoing crisis on the retail landscape, underscoring the critical need for non-essential retailers to resume operations in time for the crucial weeks leading up to Christmas.
For more information on this topic, please visit Retail Gazette and BBC Business News.
