UK High Street Turmoil As 14 Shops A Day Close In the first half of the year

LONDON (Alliance News) – High Street stores closed at around 14 per day in the UK in the first half of the year, while openings were down by a third, a report suggests.

Retailers are fighting the worst trading conditions for five years, with growth in Internet purchases and activity rates accused of the difficult climate.

The increase in "free time at home" – people prefer to spend free time and entertain at home rather than go around – is also suspected of taking a bite out of earnings.

Italian restaurants, including the Jamie Oliver chain, were particularly affected by the change, while retailers such as Toys R Us and Maplin went to the wall as more and more people buy online.

Ministers were invited to take concerted action to help the besieged city centers of Britain, with experts warning that the turmoil "will hardly diminish".

A study of 500 highways by accountants, PricewaterhouseCoopers and the Local Data Company found that 2,692 stores had disappeared in the first six months of the year – around 14 per day.

The rate is similar to the same period in 2017, although there has been a drastic drop in the number of openings year-on-year.

Compared to 2,342 stores that opened their doors in the first six months of last year, between 1 January and 30 June, 1,569 openings were opened.

Greater London and the South East were the regions most affected by chain closures, followed by the Midlands, the North East and Eastern England.

Wales was the best performing region, although it saw a net loss of 22.

Lisa Hooker, PwC's consumer market leader, said the continued rate of store closures "reflects the new reality that many of us prefer to buy online and eat, drink and play more and more at home."

"The main road is adapting to overcapacity in the retail and leisure space resulting from these channel shifts," he said.

"Openings simply are not replacing closures at a fast pace, particularly openings through" experiential "chains, like ice cream parlors, beauty salons and vape stores, have not been enough to compensate for closures in more traditional categories.

"Looking ahead, it is unlikely that the turmoil affecting the sector will diminish and the closures of the stores already announced in the second half of the year due to the administrations and CVAs will already further intensify the situation".

Tom Ironside, director of business and regulation of the British Retail Consortium, told The Guardian: "Pressure on retailers, which is contributing to closing stores, will continue unless the government takes decisive action."

He also called on the government to address "staggering growth rates for larger companies employing the majority of 3.1 million retail workers in the UK".

Toys R Us, Maplin, Poundworld and Coast have been among the main victims of the main road so far in 2018, while House of Fraser has been rescued by the founder of Sports Direct International PLC Mike Ashley.

The PLCs of Debenhams PLC, Marks & Spencer Group, Mothercare PLC, Homebase and Carpetright PLC have undertaken closing programs with different scales.

Corporate voluntary agreements have been used more frequently as the large and established chains struggle to adapt to changing consumer landscape as they are hit by adverse winds, including higher wage and rate costs.

Jamie's Italian and Price announced the CVAs, while Gourmet Burger Kitchen, owned by the Famous Brands Ltd of South Africa, and also its burger chain Byron are using the arrangements.

source: Press Association

Copyright 2018 Alliance News Limited. All rights reserved.

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