On Britain's high streets, economic recovery can sometimes seem as mythical as the elves whose jobs depend on it. But the shopkeepers of Deal in Kent at least sense a change in atmosphere from the low point of last year.

Ralph Cade, owner of the independent gift shop(Shoe Display), Greencades, said: "There were definitely people that started much earlier in November. I think a lot of people are spreading the cost because money is tight."

At least he is not seeing a repeat of last year's war of nerves as shoppers waited for last minute discounts. "We'd usually be taking £400-500 a day in December and [in 2012] it dropped down to £150-160." Then, two days before Christmas there was a sudden rush. "By that point it was too late to catch up on what we'd lost."

This year, it wasn't just the shoppers who started early. Independent shops and smaller chain stores participated in the seaside town's first collective late night opening at the end of November. At a time of rising overheads no retailer can take the chance of another depressed Christmas.

In addition to online competition, small businesses in Deal compete with high street giants such as Marks & Spencer, WH Smith and Boots.

The town has felt a relatively low impact from supermarkets with only a mid-size Sainsburys and Co-op just beyond the main shopping streets.

There is also increasing competition from bargain retailers: Poundland now stands where once there was a Woolworths, and half a dozen charity shops(Shoe Display) have replaced other chains in the last two years.

Half an hour away, the multiple retail parks of Thanet offer mega-branches of Primark, Marks & Spencer and Tesco. Canterbury boasts a department store and a high street many times bigger. Less than an hour beyond that lie Lakeside, a self-contained mall, and Bluewater, Europe's largest shopping centre.

That helps explain why Greencades has decided to close next year. Cade says: "I've become like Scrooge really, how I run my business."

In response the Deal Town Team – a voluntary group of independent retailers, self-formed after Mary Portas's review into the future of our high streets – organised for the high street to stay open until 8pm for one evening and hand out mince pies and mulled wine to the accompaniment of dancing and singing frorm local youth groups.

Despite attracting a big crowd for the choir, the event failed to inspire much actual shopping. "I was really surprised that we didn't have more people come out," said Cade, himself a member of the town team. "You do all the things you think you're supposed to do – put an advert in the local paper, put posters up around the town. The town team spent a lot of time trying to get everyone involved –visiting shops, tweeting, Facebooking."

Cade was frustrated that bigger towns, their department stores offering complimentary champagne and huge discounts, had "hijacked a community tradition".

Esme Chilton, owner of nearby grocery-cum-cafe, Allotment, said the event embodied the Town Team's mission statement: getting people to interact with their high street and value it as an integral part of their community. In an online age, she said, "high street shops are no longer the only option".Late night shopping made sense precisely because "people want something a bit different, a bit extra" from their Christmas shopping trip.

The high street is about a mile long, with a pedestrianised zone to the south, populated mostly by chain stores, and a north end dotted with independent shops and eateries. Emma Ford, the owner of the Tamarisk clothes store, said: "My shop(Shoe Display) is probably the high end of budget. It's not expensive ... A party dress doesn't really ever go beyond £70." Ford offers late-night shopping once a quarter. She focuses on "making sure you personally know your customer and making the effort to make them feel special … [Then] there's a massive amount of goodwill and they spend an awful lot of money."

She took £300 during the town team's late night opening. Then again, two weeks earlier, she "took £3,000 in two hours at my shopping evening".

Further south down the high street, the women's clothes shop, M&Co., took nothing during late night opening."The high street is getting smaller and smaller," says manager Sue Hewins. "We've already lost a few bigger shops and they're just being replaced by independents, which is great, but people need to support the bigger shops as well to keep us here."

Earlier this month Deal joined in with "Small Business Saturday" - a national day for consumers to support small, independent businesses. Locally, it was also a day of free parking – one of Portas' key recommendations. For their part, many shopkeepers are certain that this is crucial to their survival. But shoppers showed less enthusiasm for Small Business Saturday, or at least for its fundamental message – converting browsers into buyers. "People's perception of your business is far from the reality," said Cade. "All the time that people see nice shops and they see that you're open, they think that you're doing all right." In fact, Cade says, his takings were 33% down on the same day last year.

Deal's record and sports shops are recent victims of the downturn. But there are reasons for hope - the bicycle shop, Curwen's, and fishmongers, Jenkin's, maintain a healthy trade at the same scale as those that have not endured.

Despite the challenge they face as retailers, Cade and Chilton maintain a strong belief in the high street as the foundation of strong local community. Portas continues to campaign for her regeneration plans to be implemented nationwide, and last week came a sign that this town team is in-step with its spiritual leader. Deal was shortlisted as one of ten British high streets competing to be named "High Street of the Year" by Portas.

The challenge for a small cohort of volunteers organising ambitious events such as a late night Christmas shop(Shoe Display) then, is not a lack of passion from them or the community. Like many grassroots initiatives in hard times, they more often lack time and people power. Cade said that when they launched "we really thought that we could make a difference. We thought … " Chilton finishes his sentence, "... other people would get involved."

• This article was amended on 13 December 2013. It originally referred to a nearby mall as Lakeland. It is called Lakeside. This has been corrected.