A new report by PwC, one of the Big Four accountancy firms, reveals that store closures across the UK have slowed to their lowest rate for seven years. The number of chain stores shutting in the first six months of 2022 has dropped by a third compared with the same period last year, reflecting the return of shoppers to the high street now that the worst of the pandemic has passed.
The research was carried out on behalf of PwC by the Local Data Company (LDC), and covered businesses across a variety of sectors with a minimum of five outlets, including retail, hospitality, gyms, banks and hairdressers. Independent traders were excluded from the report. LDC surveyed over 3000 locations, including retail parks, high streets and shopping centres around the country.
A total of 6146 stores closed their doors in the first half of 2022 whilst 3888 opened, leading to a net loss of 2258 outlets. However, this is a marked improvement on 2020, when a total of 11120 shops closed, and is the lowest number of net closures for five years.
The study revealed that the type of shop closing has changed over the last two years. Recently, in addition to many charity shops closing, a large number of banks and betting shops have shut, as more of us carry out these activities online. This compares with the first half of last year when over 1000 clothing outlets closed, including the Arcadia Group with its chains of British Home Stores, Dorothy Perkins, Wallis, Burton, Debenhams, Miss Selfridge and Topshop brands. In contrast, the number of restaurant chain outlets opening is actually increasing, as are takeaways, DIY stores and amusement arcades.
Nick Collins, chief executive of café-bar and restaurant operator Loungers, said in the report that changes in the property market are actually helping his company to expand into prime high street locations where high rents and lack of available property previously held them back: “As banks and retailers like Dorothy Perkins have come out of the high street, these units are prime pitch locations right in the centre of the high street, benefitting from strong footfall going past all day and through the evening. That is giving leisure operators like us a great opportunity.”
Shop openings are still below pre-covid levels, and clearly with fewer chain stores around there will be fewer shops under threat of closure. However, the figures are at least heading in the right direction, and many market towns and local high streets are benefitting as people continue to work from home. Inflation and rising energy bills may yet play a part in limiting the number of new store openings, but for new businesses able to weather the economic storm there are opportunities waiting.
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Store closures at lowest rate in seven years but openings continue to lag behind pre-pandemic levels
