Retailers closing 15 stores a day

In the first six months of 2016, 2,656 shops closed on the UK’s high streets, a rate of 15 stores a day, according to research compiled by PwC and the Local Data Company.

This marks a slight increase on the 14 stores a day reported to have closed in the first six months of 2015, however, the report notes that the number of new openings also fell, leading to a net 503 stores disappearing from high streets, retail parks and shopping centres in the first half of 2016.

This represents the highest net decline since the first half of 2012, when 953 more stores closed than opened.

Madeleine Thomson, retail and consumer leader at PwC, said: “Despite the uncertainty and fall in number of store openings, consumer sentiment has rebounded following the post-EU referendum dip. With employment levels still high and price inflation yet to hit the shops, the majority of the UK public believe they will be better off in 12 months.

“If we look ahead to Black Friday and Cyber Monday upcoming research shows that 27 percent of consumers intend to make purchases, spending on average 203 pounds over the weekend. Of this spend, 17 percent of will be in store, rising to 24 percent for over 55s.”

Thomson added: “To increase footfall to their stores, it is key for retailers to ensure their in-store offering and price point is relevant for the younger demographic who are particularly high users of online channels and very price savvy.”

The analysis of 66,401 outlets operated by multiple retailers in 500 town centres across the UK found that overall volumes of activity including openings and closures plummeted from a record 7,749 in the first half of 2010 to 4,809 in the same period in 2016.

The data reveals that across multiple retailers in 500 town centres, fashion shops, banks, mobile phone shops, and women’s clothing shops were amongst the hardest hit in the period.

Mike Jervis, insolvency partner and retail specialist at PwC, said: "The data covers the first half of 2016. Since then there has been more evidence of stress in certain parts of the retail sector as costs challenges begin to crystallise. These include foreign exchange rates, Living Wage pressures and business rates increases.

“These can be managed provided revenue is maintained - so consumer spending is key. The area where we expect most problems is in fashion retailing where recent data points to lower sales volumes.”