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 cash flow.

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 cash flow 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. Your 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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