COVID-19 Plays Grinch To UK Post-Christmas Retail Sales

U.K. brick-and-mortar retailers already suffering from COVID-19 restrictions in the run-up to Christmas saw foot traffic plummet during the key Boxing Day/post-Christmas period as well.

Market watcher Springboard reported foot traffic at U.K. retailers in areas facing a strict “Tier 4” lockdown fell 72.2 percent year over year in Main Street shops between Sunday, Dec. 27 and Saturday, Jan. 2. That’s normally a heavy sales period that follows Christmas and the Dec. 26 Boxing Day holiday.

“The end of the festive trading period and tightened government restrictions unsurprisingly saw footfall in U.K. retail destinations drop significantly at the end of 2020,” said Diane Wehrle, insights director at Springboard, as quoted by the Daily Mail newspaper.

Although traffic fell less in areas under Tier 2 or 3 lockdowns and at retail parks (roughly equivalent to U.S. big-box strip malls), all U.K. retailers on average saw a 55.7 percent drop-off in foot traffic during the period. Retail parks saw the least damage, although foot traffic there still fell 31.9 percent year on year.

London and much of the surrounding area had been under Tier 4 restrictions after a new COVID-19 variant emerged in the United Kingdom that appears easier to spread than the original strain. On Monday (Jan. 4), U.K. Prime Minister Boris Johnson imposed an even stricter “national lockdown” to prevent the new strain’s spread.

Retailers had hoped that decent sales around Boxing Day could make up for revenues lost earlier in the pandemic or at least not make things worse. Statista previously estimated that for the Nov. 15-Dec. 31 period as a whole, U.K. holiday sales would fall 11.6 percent to 73.5 billion pounds ($99.8 billion) from 83.1 billion pounds a year earlier ($112.8 billion).

A Centre for Retail Research study done for VoucherCodes.co.uk had estimated that Boxing Day sales in physical stores would fall 56 percent to 1.4 billion pounds ($1.9 billion), while online sales would rise a similar 56 percent to 1.8 billion pounds ($2.4 billion).

But because brick-and-mortar sales were starting from a larger base, researchers estimated that the day’s overall 3.2 billion pounds ($4.3 billion) of sales would represent a 27 percent year-on-year decline, according to The Independent newspaper.

Based on Monday’s foot-traffic numbers, the actual results were likely even worse. “The post-Christmas sales are always one of the busiest times for retailers, and while this is still the case, it’s not surprising to see a decline in sales for the third year in a row, especially due to the new restrictions in place for most of the country,” Anita Naik, lifestyle editor at VoucherCodes.co.uk, told the paper.

Springboard’s Wehrle doesn’t see things improving any time soon for U.K. stores.

“Retailers are unlikely to see any respite until restrictions are eased in the coming weeks or months,” she said, as per the Daily Mail. “We know from our experience of retail reopening in June 2020 that until the widespread roll out of the vaccine, retail footfall will remain significantly below the pre-COVID level.”