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UK Stores Sees 88% Traffic Growth in First Full Week Back

With British high streets opening back up to the public on April 12 after four months of Covid-19 lockdowns, non-essential retailers across the U.K. have been able to get their first taste of real in-store shopper traffic this year.

And the numbers are showing just that. According to Springboard Insights, U.K. retail footfall surged 88 percent week-on-week for the week of April 12-18. Annually, footfall was up more than four-fold. However, despite the big improvement, Springboard noted that traffic is still down 25 percent from pre-pandemic numbers from two years earlier.

In high street locations, footfall is down 35 percent from two years ago, while it is off by 28 percent in in shopping centers. In retail parks, the equivalent of larger non-mall shopping centers in the U.S., the decline was just 2 percent.

The analytics firm noted that the extent of the uplift last week means that the gap in traffic from 2019 across all U.K. retail destinations has narrowed by more than a half in a single week, reaching the level achieved after two months of business following the first lockdown in 2020.

“The key issue for retail destinations will be whether this momentum can be sustained,” Diane Wehrle, director of Springboard Insights, said in a statement. “From our evidence of the last two lockdowns, we are expecting footfall to continue to increase over the next few weeks, albeit at a lesser rate. However, the reopening of indoor hospitality on May 17 will provide a further boost to retail destinations as many indoor venues are located in high streets and shopping centers.”

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Retailers in the U.K. need all the positive news they can get, with nearly 10,000 chain stores shuttered in the market last year, according to PwC.

U.K. consumers share the optimism that Springboard Insights has, with 68 percent saying they believe that shopping locally is important and a majority expecting to shop more locally post-pandemic than before, according to a survey from Shopify.

These shoppers are going to want more flexibility in how they pay in store given the desire for quick, convenient payments—70 percent of U.K. shoppers indicated that the ability to make contactless payments was important to them, with 67 percent saying that it is more important now than before the pandemic, the Shopify survey said.

M&S extends fulfillment center to serve as online warehouse

Although the country’s in-store foot traffic news is promising, one of the U.K.’s biggest retailers is continuing to fortify its omnichannel operation with the expansion of one of its fulfillment centers to handle more e-commerce orders.

As part of its “Never the Same Again” program, Marks & Spencer (M&S) will extend its Bradford Distribution Centre to include a new section dedicated to online fulfillment. The retailer is trying to build on a 34 percent increase in e-commerce sales and a 75 percent boost in international e-commerce sales in the first half, which underlined the recent shift in customer spend throughout the pandemic.

M&S opened the Bradford Distribution Centre in 2010, with the location currently delivering both clothing and food to M&S stores in partnership with XPO Logistics. This new expansion investment is using existing vacant space within the center to create a new online warehouse for M&, supporting the retailer’s first online-centric warehouse in Castle Donington and its in-store pickup model.

The expanded area of the Marks & Spencer Bradford Distribution Centre is expected to be operational by Christmas 2021.
The expanded area of the Marks & Spencer Bradford Distribution Centre is expected to be operational by Christmas 2021. Marks & Spencer

The investment in Bradford follows a successful trial over Christmas 2020, where Bradford’s employees manually picked product from the existing automated distribution center to service online orders. At its peak, the site was dispatching 14,000 items a day. The build is now underway with the aim to be operational for Christmas 2021.

The team will start with the target of dispatching 35,000 items a day, looking to increase capacity over time. Bradford will be an online warehouse for boxed products from bras to belts and the aim is for it to eventually support around 20 percent of the retailer’s online orders.

M&S selected Bradford for this extension due to its location, its excess space, its automation capabilities and its engineering team, the company says. The use of automation is what enabled M&S to adapt to servicing more online orders from Castle Donington during the pandemic, “and most importantly doing so in a safe way,” it added.

While automated technologies will power the facility, the extension will still create approximately 300 roles, largely related to product picking. M&S will share more details on the center and the roles within it with the local community this summer.

“We’re transforming our clothing business to be more relevant, more often for our 22 million customers, however they choose to shop,” Stephen Langford, director of M&, said in a statement. “Whilst it’s exciting our stores have reopened, growing our online business has never been more important and part of that is a behind the scenes network which means we can serve our customers as efficiently as possible. Building Bradford is a key way we’re setting ourselves up for a more digital future at M&S under the banner of MS2.”

MS2 is Marks & Spencer’s online, data and digital division, designed to help bolster the company’s e-commerce presence based on three pillars: the best offer (e.g. buying for online demand), brilliant selling models such as the company’s new “mobile-first” approach and famous service offerings such as click-and-collect.

M& continues to offer free click-and-collect and contact-free home delivery for its shoppers, with these orders predominantly coming from either Castle Donington or the more than 200 stores currently acting as micro-fulfillment centers. And in 2020, app downloads increased 200 percent, with the retailer’s Sparks members now at over 10 million.

Shopify’s study indicates that M&S has its mind in the right place. According to the e-commerce giant, which surveyed 1,000 U.K. shoppers to discover what they wanted when stores reopened, indicated that while 87 percent of customers did at least half of their shopping for non-grocery items in person prior to the pandemic, this number dropped below 40 percent in the full lockdown. While the in-person number will increase again after the pandemic, the number from before the pandemic that said they will do at least half their shopping online (35 percent) will also jump to 58 percent after the pandemic.

Additionally, the proportion of shoppers ordering a product for delivery when they are in a store is likely to increase by more than half—from 25 percent before the pandemic to 40 percent after—further incentivizing M&S to bolster its fulfillment operation.

Alongside the Bradford facility extension and the implementation of equipment including “autobaggers” at Castle Donington that can each pack 2,000 items every hour, M&S is aiming to reengineer its supply chain through operational technologies such as Microsoft Power BI and Microsoft Teams. In addition to the manual build of Bradford, M&S aims to complete behind the scenes IT deployment to ensure it can most efficiently use its “three” warehouses: Donington, Bradford and its stores.

“Warehouse colleagues have been our behind the scenes heroes during the pandemic, making sure customers’ parcels are picked, packed and shipped, safely and efficiently,” Sarah Monk, program manager for the Bradford project at M&S, said in a statement. “The team at Bradford did an amazing job supporting with online Christmas orders and we’re all so excited that we’ll now be permanently running an online operation from the site which will include the recruitment of 300 new XPO colleagues.”