Latest Retail Traffic Index (RTI) figures, released by Ipsos Retail Performance today, show the number of shoppers in non-food stores increased by 1.2% in September 2012 against the same month in 2011.
This marks the first month of the year in which retail footfall has risen, said researchers.
Month-on-month store traffic was down by 4.8% on August 2012. For Quarter Three as a whole the RTI stood 7.3% up on Quarter Two – well above the 4.4% seasonal average of the three previous years. The Index was just 1.6% down on Quarter Three 2011, compared to year-on-year deficits of 6.0% in Quarter Two and 5.4% in Quarter One.
“We have been seeing footfall gradually returning to the shops as the year has worn on,” said Tim Denison, director of retail intelligence at Ipsos Retail Performance. “The gap on last year has been steadily closing, and now, for the first time this year, we have recorded a month of growth.”
The results from Ipsos are the latest metric to suggest aspects of the economy are beginning to stabilise.
The labour market is strengthening: the total number of jobs has grown by more than a quarter of a million over the last three months and unemployment is in decline. Job vacancies are rising and redundancies falling.
Retail sales are continuing to grow, up 3.4% in September 2012 (total sales value), according to the BRC/KPMG Retail Sales Monitor.
Inflation, now standing at 2.5% (CPI), has dropped considerably from its 5.2% peak in October last year.
For the third consecutive month, household spending power has risen. In August 2012, families had £2/week more disposable income to spend than the year before, according to the Asda Income Tracker.
Consumer confidence measures continue to show improvement, albeit they remain firmly entrenched in negative territory, said Ipsos Retail Performance.
“None of these latest results are symptomatic of an economy on the slide, but at the same time we might fool ourselves that everything is rosy,” said Denison. “Many indicators are still pointing in the wrong direction and those that have turned may have just seen temporary respite. Concerns over energy and commodity price increases, for example, could refuel inflation towards the end of the year.”
As regards footfall, it was the last fortnight of the month that produced the year-on-year improvement, said researchers. The autumnal weather brought shoppers out in force to find suitable seasonal wear, in stark contrast to the same time last year when temperatures soared to the heights of mid-summer.
“Let’s be clear, retailing is still hurting,” said Denison. “The number of retailers entering administration is once again on the rise, as a consequence of the continuing low level of demand, and margin sacrifice.
“The number of store units in the UK run by multiples has shrunk for the first time in history. We continue to read about retrenchment and redundancy.
“But equally let’s not talk ourselves down and back into decline. Some key metrics are showing signs of improvement and we should be thankful for that.”