Net loss of stores rockets almost threefold says PwC and Local Data Company

Published at 00:01 AM on 16 March 2015

            Mobile phone shops, former bank branches , money services shops suffering  

             Charity shops, coffee shops and E-Cigarettes outlets bucking the trend

Despite the rate of high street store closures stores stalling at 16 per day in 2014,close to three times as many shops disappeared compared to 2013 as the high street continues its drastic overhaul in response to the advance of online sales and changing consumer demand.

According to PwC research compiled by the Local Data Company (LDC), 5,839 outlets closed in 2014 compared to 4,852 openings. This equates to a net reduction of 987 shops as significantly fewer shops opened despite similar numbers closing year on year. 

This net loss increased significantly from 371 closures in 2013, the study of multiple retailers in 500 town centres across Great Britain found. In 2013, 5,662 stores opened and 6,033 stores closed, a rate of 16 stores shutting a day. 

The changing profile of town centres is clear from this analysis. 765 goods shops of a more traditional type (e.g. clothes and shoe shops) pulled down the shutters. Service retail (opticians, travel agents, hairdressers, recruitment agencies) saw a further net decline in shops from -299 units in 2013 to -457 in 2014. Leisure stores (food, beverage & entertainment) have continued to thrive albeit at a slower rate. There were an additional 233 stores of this type on the high street in 2014 compared to an extra 311 in 2013.

Charity shops, coffee shops, tobacconists/E-cigarettes, pound shops and betting shops were among those opening the most branches during 2014.

 

Mike Jervis, insolvency partner and retail specialist at PwC said:

 

"This year’s numbers expose the harsh impact of ‘macro’ changes on the high street, especially in certain sub-sectors. Regulation has blindsided the money shops, the advance of technology has hammered some phone operators and the internet continues to dent the clothing sector. Despite the benign economy, the net loss of shops has accelerated. The insolvencies of Phones4U, Blockbuster, Albemarle & Bond, and La Senza, a diverse cross-section of the retail market, epitomise these factors.  

 

“Despite the continuing problem of closures, new sub-sectors, such as discount shops and charity shops keep growing. The strength of the restaurant and fast-food sectors is also a fillip for the high street.”

Risers

Net Change   (Units)

Net Change   (%)

Fallers

Net Change   (units)

Net Change   (%)

Charity Shops

64

1.78

Mobile Phone Shops

-419

-18.08

Coffee Shops

62

3.35

Building Societies

-137

-14.57

Tobacconists/e-Cigarettes

55

41.98

Cheque Cashing

-117

-18.37

Discount Stores (Pound   Shops)

51

6.29

Pawnbrokers

-116

-16.96

Bookmakers

50

2.02

Women’s Clothing

-98

-7.14

Jewellers

38

3.65

Fashion Shops

-84

-2.13

Take-Away Food Shops

38

2.64

Video Library

-68

-100.00

Restaurants – American Cuisine

37

18.78

Men’s Clothing

-55

-8.83

Restaurants – British   Cuisine

25

24.51

Recruitment Agencies

-55

-5.66

Postal, Packaging &   Shipping Shops

24

20.87

Travel Agents

-53

-4.85

Table 1. Top risers and fallers by business type in 2014 (Source: Local Data Company)

Mark Hudson, retail leader at PwC, said:

 

“We're again seeing the continued effects of the digital revolution and consequent change in customer behaviour play out on the high street - these trends have been with us for some time and we should expect the rate of closures to continue. Customers are embracing new mobile technologies, traditional retail channels to market are being wiped out and new channels are being created, often in the online rather than the "real" world.

 

“The future can be seen by watching the ‘digital natives’ at work and play - those who have grown up with online shopping, mobile phones and ubiquitous broadband have a very different relationship with traditional high streets than the previous generations. Rather than try to recreate the past, the high street needs to evolve to be relevant to the future.”

Across Great Britain

Openings and closures of multiple retailers by region across the top 500 GB town centres in 2014

Country/

Number of store closures

Number of store openings

2014

net change

2013

net change

English Region*

East Midlands

446

299

-147

-68

East Of England

450

418

-32

8

Greater London

1,386

1,303

-83

-11

North East

213

149

-64

-58

North West

542

410

-132

-65

Scotland

312

246

-66

-31

South East

862

787

-75

-61

South West

521

444

-77

15

Wales

159

120

-39

-15

West Midlands

524

371

-153

-76

Yorkshire and the Humber

424

305

-119

-8

Total

5,839

4,852

-987

-371

 

Table 2. Multiple openings and closures by region in 2014 (Source: Local Data Company)

 

Matthew Hopkinson, director of The Local Data Company, said:

 

“This analysis shows the second most significant annual decline in chain retailers in our town centres - a net loss of 987 stores versus the all-time high of 2012 when 1,779 units  pulled down the shutters for the last time. This is an increase of 266% compared to the net closure of 371 shops in 2013. 

 

“Our town centres continue to evolve away from traditional shops and services to leisure - food & beverage and entertainment.  This is reflected by American and British restaurants featuring in the top 10 risers along with the impact of click and collect services showing a 20% growth in 2014.

 

“Change will continue and the area to watch in 2015 is the battle of the convenience and food store sector as supermarkets, the discounters and pound shops fight it out.

 

ENDS

 

Notes to editors

 

  1. Multiples are retailers that have more than 5 outlets nationally
  2. The vast majority of building societies highlighted in the fallers table are Britannia bank branches reclassified as building society outlets. In classifying Britannia as building societies it must be noted that some closed and some transferred to Co-Op Bank.

 

About PwC

PwC helps organisations and individuals create the value they’re looking for. We’re a network of firms in 157 countries with more than 195,000 people who are committed to delivering quality in assurance, tax and advisory services. Find out more and tell us what matters to you by visiting us at www.pwc.com.

 

PwC refers to the PwC network and/or one or more of its member firms, each of which is a separate legal entity. Please see www.pwc.com/structure for further details.

 

About the Local Data Company

The Local Data Company (LDC) is the UK’s leader in retail location data and insight. Combining powerful proprietary technology with a unique, field researched database of over half a million premises, LDC delivers data, market analysis and unique profiling to the leading retailers, financial institutions, analysts, search engines, online directories and the media. Using its army of field researchers, LDC delivers insight on thousands of locations, including high streets, town centres, shopping centres, retail parks and standalone out of town stores. LDC brings data alive and delivers clarity through its integration, aggregation and highly visual delivery.

 

The analysis is derived from The Local Data Company visiting the top 500 town centres. Each premise was visited and its occupancy status recorded as occupied, vacant or demolished. Vacant units are those units, which did not posses a trading business at that location on the day we visited it. Internal shopping centre data is included where we have had co-operation from the landlord. The total number of multiples premises surveyed was 65,452.

 

The town centre is defined as per DCLG’s definition of the retail core. Scotland has no official retail core geography so the geography taken is the postal town area where not specified otherwise. Net change is openings less closures. The percentage change is derived from the net change figure relative to the total number of live multiple businesses.

 

The closures figure is the total number of closures in 2014 divided by 365 days

5839/365=15.99 stores per day

 

©2015 PricewaterhouseCoopers. All rights reserved.

 


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About PwC

At PwC, our purpose is to build trust in society and solve important problems. We’re a network of firms in 157 countries with more than 208,000 people who are committed to delivering quality in assurance, advisory and tax services. Find out more and tell us what matters to you by visiting us at www.pwc.com.

PwC refers to the PwC network and/or one or more of its member firms, each of which is a separate legal entity. Please see www.pwc.com/structure for further details. © 2016 PwC. All rights reserved

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