UK store closures hit new record says Local Data Company
The number of high street shop closures hit a record level in the first half of 2020 amid a challenging year for retail and leisure.
According to research by the Local Data Company and PwC UK, there were over twice as many net store closures on UK high streets in the period from January to August in comparison to last year.
The figures underline the many difficulties facing retailers as the impact of Covid-19 continues to influence consumer behaviour.
In the first half of 2020, some 11,120 chain operators outlets closed their doors, with 5,119 shops opening, creating a net decline of 6,001 — almost double the decline tracked last year.
“We know that the pandemic will continue to impact the way we work, rest and play, however, in terms of how we shop, this isn't new. What we have seen is an acceleration of existing changes in shopping behaviours alongside forced experimentation from Covid-19 restrictions,” said Lisa Hooker, consumer markets leader at PwC.
Some sectors are faring better than others, with value retailers and discount supermarkets showing more resilience than fashion retailers as consumer demand for value continues to rise.
Leisure is also likely to remain resilient, the report predicts, with takeaways and pizza delivery shops dominating the number of openings.
Lucy Stainton, head of retail and strategic partnerships at the Local Data Company said: “The results from H1 2020 are a stark reminder of the challenges faced by retailers in the first six months of the year, which included a national lockdown. There are signs that this is just the tip of the iceberg, as 22% of the multiple market is still closed temporarily.
“With each week that passes since retail and hospitality businesses were given the green light to reopen, the likelihood of these occupiers ever trading again in those units reduces. This, alongside the impact of local lockdowns and other restrictions such as the 10pm curfew will continue to have a devastating impact on the sector with more closures likely to fall in Q1 2021 following the busier golden quarter.”
But not everything is doom and gloom, with the report highlighting a few positive things. Firstly, PwC said there has been a resurgence of interest in local high streets fuelled by the practicalities of lockdown and rise in working from home. Additionally, there are opportunities for retailers to innovate and adapt, with the availability of prime property, increased spend and changing consumer habits offering agile retailers the chance to weather the storm.
Jonathan House, devolved and local government lead partner at PwC, also underscored the role of local leaders in working with businesses to set out a new vision for Britain’s high streets.
He said: “There’s a once in a lifetime opportunity to reimagine high streets that are at the heart of our local communities and local economies. The high street won’t go back to how it was and can’t recover through the retail sector alone. Businesses, communities, local and central government need to come together and create liveable, vibrant and different places where people want to live, work and visit.”
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