High street shops closures hit low

High Streets in a survival fight

RETAIL: The number of high street shops facing closure has dropped to its lowest level since 2010, but not significantly enough to prevent the UK from losing the equivalent of 14 fewer chain stores each day, according to new research.

THE NUMBER of high street shops facing closure has dropped to its lowest level since 2010, but not significantly enough to prevent the UK from losing the equivalent of 14 fewer chain stores each day, according to new research.

Charity shops, shoe stores, gift shops and women’s clothing retailers were the most affected on British high streets in the first six months of the year but Yorkshire proved that the continuing trend was not one that was universal.

The region was one of only two areas nationally to experience net openings, the other being the East Midlands.

Nevertheless, the prevailing narrative is of more closures, albeit at the slowest rate since the start of the decade. An analysis of 67,521 chain stores – accounting for those with more than five national outlets – across 500 town centres in Great Britain showed that there were 2,564 store closures between the start of January and the end of June.

According to the study, by the Local Data Company on behalf of PwC (PricewaterhouseCoopers), the number of closures outstripped the 2,342 shop openings during the first half of the year, but at an average of 14 store closures per day, it represented the lowest number of closures since 2010.

The net difference between closures and openings has also “shrunk significantly” to 222 stores versus the net loss of 503 stores in the first half of 2016, and is the smallest figure since the same period in 2013, when 209 more stores closed than had opened.

Mike Jervis, an insolvency partner and retail specialist at PwC, said the “relatively low” number of closures over the period reflected a “more stable environment” and proved that consumer confidence was more resilient than had been expected.

Stores that have previously seen notable high street declines have also started to reach an “equilibrium”, according to PwC, with general fashion stores, banks and cheque cashing shops recording their lowest number of net closures in three years.

But tobacconists, coffee shops and beauticians saw a relative boom, having seen their presence on the high street grow at the fastest pace among their peers in the first half of the year.

Ice cream parlours were also amongst the winners, thanks to openings by chains including Ben & Jerry’s and Kaspa’s Creams.

Commenting on Yorkshire’s relative success, Matthew Hopkinson, director of the Local Data Company, said: “Regional variances show the importance of understanding local economies. Some regions such as Yorkshire and the Humber have shown a significant turnaround from a loss of 20 units in H1 2016 to growth of 12 units on H1 2017.”

In the East Midlands, there was a net rise of eight stores.

Despite an improved UK-wide trend, PwC’s Mr Jervis warned that the retail sector could still face trouble.

“The environment is, of course, uncertain, with recent data showing a more challenging retail environment. I expect net store closures to be an ongoing feature of the market.

“Retailers will choose specific closure stores very carefully and will aim to capitalise on leases expiring in the ordinary course of their businesses.”

Scotland saw the biggest number of net closures, but that figure narrowed from a loss of 87 stores in the first half of 2016 compared to 42 this year.

Even London suffered a net drop of 23 stores, down from a loss of 164 sites in the first half of 2016.

Retailers will choose specific closure stores very carefully. Mike Jervis, an insolvency partner and retail specialist at PwC

EVEN THOUGH Yorkshire appears, thankfully, to be bucking the national trend, according to a new survey, when it comes to High Street shop closures, there’s no room for complacency. There’s no one-size-fits-all solution as online suppliers increase their strangleholds – even a series of pilot projects set up by retail guru Mary Portas during David Cameron’s government had very mixed results.

Yet, with an average of 14 stores closing each day across the country, perhaps the most important lesson is this: buildings left empty for prolonged periods to have a tendency to become a magnet for criminals and drag down an area’s aesthetic appeal. If this means local authorities having to be more proactive when it comes to planning applications to change the use of former shops into offices, or other commercial premises, they should not be afraid to do so.

After all, first impressions do count, hence the importance of innovative policies to ensure areas remain open for business.