From a peak of more than 20 store closures a day in the first six months of 2012 to 18 per day in the same period in 2013, the rate of store closures has fallen again from 16 in 2014 to 14 per day in the first half of 2015, according to PwC research compiled by the Local Data Company (LDC).
The study of 500 town centres across Great Britain shows that 2,634 outlets closed in a six-month period compared to 2,197 openings, a net reduction of 437 shops.
Coffee shops, jewellers, pizza takeaway, and charity shops were among those growing at the fastest rate during the first half of 2015.
The data also revealed that across multiple retailers in 500 town centres cheque cashing, banks, fashion shops, gift shops, women’s clothing shops and fashion shops have been amongst the hardest hit in the first half of 2014. Banks have had the biggest swing from being in the top risers in H1 2014 with a net opening rate of +43, to the fallers list with a -97 net closure rate in just 12 months.
Burger chains, coffee shops growing
Mike Jervis, insolvency partner and retail specialist at PwC, said:
“The changing profile of town centres is very clear in this analysis – 155 goods shops of a more traditional type (e.g. shoe & clothes shops) pulled down the shutters. Service retail (e.g. travel agents, pawnbrokers) saw a continued net decline in shops from -245 units (-1.43%) in H1 2014 to -299 (-1.72%) in H1 2015. Leisure chains (food, beverage & entertainment) have continued to thrive albeit at a slower rate with the number of outlets from +170 (1.17%) in H1 2014 to +43 (+0.29%) in H1 2015. Although within the leisure sector there is a variance with categories such as American restaurants (Burger chains), Café & Tearooms and Coffee shops, which are growing, while betting shops and pubs are closing.”
Decline of pubs and clothing shops
Matthew Hopkinson, director of The Local Data Company, said:
“The results of the openings and closures of chains in our top 500 town centres in the first half of this year are encouraging. Closure rates are down and the gap between openings and closures is narrowing. This is as a result of wider consumer confidence, adjustments to market rents and most importantly a better understanding by chain retailers as to the role and opportunity that shops still have to play in the Total Retail environment.
“That said, as ever, the devil is in the detail where we are seeing the continuing decline of pubs and clothing shops whilst seeing previously expansive sectors such as banks, betting shops and cheque cashing/pawnbroking all in retreat from the high street. The only growth sector is food and beverage, which is growing albeit it at a slower rate in our town centres but increasingly at the expense of others within the sector.
“High activity levels of multiple businesses opening and closing are set to continue with increased competition from ‘destination locations’ be they high streets, shopping centres or increasingly out of town parks. London is no exception to this as the figures show. In the last five years alone over 62,000 shops of multiple retailers have opened and closed in the top 500 GB towns so look wider and that number rises significantly. As Heraclitus said, ‘the only thing that is constant is change’.”