Estimating footfall figures
If you're setting up a retail business, being able to accurately
predict its footfall will help you determine everything from the
location you choose to how you price your stock to how you plan
your cashflow.
What are footfall figures?
- Footfall figures look at the number of pedestrians who
pass through a certain area - whether that's regional
shoppers, pedestrians who walk up a certain high street or the
number of people who visit a shopping mall.
- The more people who are in the area, the more passing trade
there is for local retailers, which means a street or area
with a high footfall figure is beneficial to most local
retailers.
- Looking at shifts in footfall figures will also help you to
work out when your seasonal peaks and troughs will be
- for example, footfall almost always rises during the Christmas
shopping season, but tails off during the first few months of the
year. Having this information available will allow you to plan your
cashflow for the year and work out how much to save when things are
tight.
How to predict footfall figures
- Accurate footfall figures can be difficult to
find, but the British Retail Consortium (BRC) publishes
monthly Retail Sales Monitor which includes footfall figures. For
figures more specific to your location, it may be helpful to
contact your local Regional Development Agency (RDA), Chambers of
Commerce or trade association. You local council might also be able
to point you in the direction of some reliable figures.
- Local newspapers frequently publish information regarding
trading conditions, so take out a subscription to your local
rag for statistics on footfall as well as what the demographics are
like in the area you're planning to set up shop in.
- Remember: footfall figures are not essential for every
business. If you're planning to start a plumbing business or
IT consultancy, passing trade will be minimal so you won't need to
worry too much.
- While it's unrealistic to expect to make a sale to every person
who passes, you can use footfall figures to estimate the
number of sales you might make using local demographics to
help. For example, if the area you are looking to start up in has a
high number of young, affluent parents, it's probably the ideal
place to start a babywear boutique.
Checklist
- Footfall figures show you the number of people who pass through
a given area
- A high footfall figure is important if you want to start a
retail business
- Footfall figures will help you work out when your seasonal
peaks and troughs are likely to be
- Use publications from the BRC or your local RDA, Chambers of
Commerce, trade association or even council to find figures
- Local newspapers frequently publish information
- Footfall figures are not essential to every business
- Use local demographics to help estimate sales
Jargon buster
Total growth: the percentage difference between the
figure (sales, footfall etc) now compared to during the same period
12 months ago.
Like-for-like growth: the same figure as total
growth, but without stores which have opened or closed in the
intervening year. Like-for-like growth is always smaller than total
growth.
Resources
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