Retail boom for East Midlands in H1 2017

The number of chain retail outlets closing in the East Midlands is at its lowest level for 4 years, PwC research compiled by the Local Data Company (LDC) reveals.

The analysis tracked 4,538 outlets in the East Midlands operated by multiple retailers* in  34 town centres across the region.  In the first six months of 2017, 175 shops opened on high streets, retail parks and shopping centres, alongside 167 closures.

The Data shows, the net difference between store openings and closures in H1 2017 has shrunk significantly to +8  stores compared to a net loss of -21  in H1 2016, representing the highest net increase since 2013.

Nottingham  faired well with a net loss of 8 stores, with 8 closures and 16 openings. Derby had the same number of openings and closures at 23 with no net change and Leicester had a net loss of 4 stores with 20 new store openings and 16 closures over the period.  Stamford, Sherwood, and Newark on Trent maintained the same number of stores, while East Retford saw the biggest net decline in stores -7.

The analysis also finds that online growth may be a factor in an already leaner, fitter high street evolving further.  With a higher online sales presence in the UK as a percentage of total retail sales than the United States or any country in Europe. Desktop PCs are still the most popular device for placing online shopping orders but mobile devices, especially smartphones, are catching up.

Andy Lyon, partner and head of retail at PwC in the Midlands said: “It’s encouraging to see the high street holding up and even rallying in some cases. The twin canons of increased online purchases and a tough economy have seen many retailers take a long, hard look at their store portfolios. There will always be a physical presence on the high street, but developments in technology are accelerating and impacting future staffing and operating models.

“Ways of shopping are continuously transforming and include subscription models, the connected home, and companies using data analytics to suggest your next purchase. Major questions are beginning to be asked about who will ultimately ‘own’ the consumer.

“The UK is one of the world leaders for consumer online purchases. Retailers must continue to evolve if they are to make the most of both new digital opportunities and the country’s high streets.”

The data reveals that the East Midlands is the second best region across England for the net change in the difference between openings and closures, from H1 2016 -21 to +8 in H1 2017 rising from sixth place to second.

Amongst those growing at the fastest rate during the first half of 2017, were fashion retailers (5), tobacconists (4) and women’s clothes (4), with this traditional retailing sector seeing 82 new openings and 65 closures leading to a +17 net change.

However, across multiple retailers in the East Midlands, pubs, newsagents  and discount stores were among the hardest hit in the first half of 2017.

Openings and closures of multiple retailers by region across the top 500 GB town centres in H1 2017

(Source: Local Data Company)

Matthew Hopkinson, director of The Local Data Company, said: “The reduction in the number of chain retailers closing in Britain’s town centres indicates an increasing degree of stability for many towns that have seen the significant loss of multiple retailers over the last ten years. From an average loss of 540 chain shops every six months to just -222 in H1 2017 is a major slow down.

“Regional variances show the importance of understanding local economies. Some regions such as Yorkshire and the Humber have shown a significant turnaround from a loss of 20 units in H1 2016 to growth of 12 units on H1 2017.

“It is the leisure sector that is creating more openings than closures on our high streets while traditional shops and services, such as clothing and banking, continue to close stores. If the leisure offer has reached saturation, which I argue it has, then this slowdown in the closure rate might be short lived if the leisure growth rates reduce from their current levels.”