Shop closures in the UK have hit record levels with over twice as many net store closures in the first half of 2020 in comparison to last year, according to research by the Local Data Company and PwC.
The data shows that 11,120 chain operator outlets have closed this year so far, with 5,119 shops opening, creating a net decline of 6,001, almost double the decline tracked last year (3,509).
The steep decline comes amidst a challenging year for retail and leisure which has seen many stores have to close either temporarily or permanently as the impact of Covid-19 continues to influence consumer behaviour.
The data shows that the pandemic has accelerated previous trends that have changed the way consumers shop, so, although retail sales already recovered to pre-Covid levels by July, there have been greater shifts in categories and channels. However, store openings of multiples, which have remained at broadly the same level over the past five years, also show that despite the acceleration in closures in 2020, there remains consistent demand for retail, hospitality and services that can only be delivered physically.
Lisa Hooker, consumer markets leader at PwC, said: “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.
“We all knew that consumers were shifting to shopping online or changing their priorities in terms of the things they buy, but what Covid-19 has done is create a step change in these underlying trends to where they have now become the new normal.
“While it’s challenging for many, these results do prove a few positive things. Firstly, there’s been a resurgence of interest in local high streets. The practicalities of lockdown and the increase in working from home mean that independent shops tend to be located where consumers increasingly are.
“Plus a steady flow of openings, with the continued roll out of value retailers, the boom in takeaways and pizza delivery shops and demand for services that can still only be delivered locally such as tradesmen outlets, building products or locksmiths, shows that despite the stark numbers there remains a future for physical stores. We all still want and need to physically visit shops and leisure operators, it’s likely then that whatever happens retail will come out of this smaller but stronger.”
NAM Implications:
- Quality meeting of consumer needs, delivering more than it says on the tin, every time.
- Any business (supplier or retailer) short-falling re the above, dies.
- What has really changed, deep down?
- The new norm has simply arrived a little faster…
- …but the real basics remain…
