High street crisis deepening
4 March, 2013
The depression on UK high streets shows no signs of easing, with the number of stores closed by retailers continuing to surge over the last year.
Analysis by the Local Data Company and consultants PwC found that chains shut stores at a rate of 20 a day in 2012. The closures intensified over the last few months of the year. In total, the research measured 7,337 closures over 2012, compared with 5,558 new openings, making for net closures of 1,779—nearly five a day. Net closures were highest in the south east of England at 376—though this region had the highest number of shops to start with.
The downward trend is something of a double-edged sword for food and drink operators, as it frees up more sites for openings—but they are clearly in locations where footfall might not be enough to sustain businesses. And while closures are bad news for retail in general, they have created opportunities for recession-fuelled businesses like payday loan shops, pawnbrokers and pound shops. Another beneficiary seems to have been coffee shops, which the Local Data Company found had increased their presence on the high street by 3.4% in 2012.
Matthew Hopkinson of the Local Data Company said: "People have got less money in their pockets, employment is tighter and also we've seen a massive growth in the supermarkets in terms of non-food retail, and we've seen the internet go from nothing to 12% of retail sales—and that's forecast to be at least 30% by 2020. So people are shopping less and they're going to alternative channels."
For more on the Local Data Company’s research, click here.