High street crisis: Record number of shops disappeared in 2018
Britain’s top high streets lost a record net 2,481 shops last year, following years of decline.
An average of 16 stores closed per day in 2018 – compared to nine opening daily – according to PwC research compiled by the Local Data Company (LDC).
The net number of store closures is calculated by comparing the number of shops opening with the number closing.
It is not all bad news for retailers, as ice cream parlours and vape stores have been increasing in number.
High streets have been hit by lower footfall, increasing costs and a shift to online shopping in recent years.
In February, the number of visitors to UK shops dropped by 2% – the biggest decline in the month in five years – according to figures from Springboard and the British Retail Consortium.
Although the number of store closures remained the same as in 2013, a 44% drop in store openings has left the number of high street shops dwindling.
The analysis also showed that banks, fashion retailers and electrical stores were among the worst hit, as customers turn to online options.
There was also a decline in leisure, in particular pubs and bars, which suffered a net loss of 506 outlets – reversing three years of consecutive growth since 2015.
Market saturation, cost challenges and a shift in consumer preference towards in-home leisure have made the impact on the sector worse and discouraged new openings.
Meanwhile, ice cream parlours, sports and health clubs, bookshops and vape stores rose in popularity.
Lisa Hooker, a spokesperson for PwC, said “tough decisions” would need to be made in the next few years.
She added: “The results are clear – 2018 was a turbulent year for retailers with a number of high profile store closures.”
Across the UK, the number of stores closing was higher than openings in all regions.
The worst affected regions were Greater London, the South East and the East of England.
:: Tax online retail to create ‘level playing field’ for high street – MPs
Greater London recorded the highest number of net closures at 528, which is 57% higher than the 336 net closures in 2017.
However, closures have increased the most in the South East, where there were 399 net closures compared to 185 two years ago.
Scotland was the only region to see a drop in its net closures, falling from 149 in 2017 to 119 in 2018.
Helen Dickinson OBE, Chief Executive of the British Retail Consortium, said the latest analysis pointed to “immense cost pressures” for British retailers.
She said: “It is no accident that the retail sector is losing jobs and stores while the raft of business costs continue to expand.
“Retail is undergoing a period of unprecedented change in response to new technologies and changing consumer behaviour.
“Unless the government reforms the broken Business Rates system and looks to review the multitude of business cost, we are likely to see further store closures and job losses.”
A number of stores, including New Look, Carpetright and Mothercare, have resorted to company voluntary agreements (CVAs) in recent years.
Zelf Hussain, a spokesperson for PwC, said CVAs were “not the answer” in isolation, but acknowledged that retailers face an “uphill battle”.
It is estimated 150,000 jobs were lost in 2018.
Source: Read Full Article