Store closures decline in first half as retail fights back

THE rate of store closures in the West Midlands during the first half of 2013 has fallen slightly compared with the corresponding period last year, new data shows.

The PwC research, compiled by the Local Data Company, shows 293 outlets closed in the first half of 2013, compared to 349 in the first six months of last year.

The study of 500 town centres across the UK showed that multiple retailers opened 253 stores in the region in the first half of 2013, up from 189 in H1 2012, so net closures totalled 40. However, year-on-year, the net reduction in the number of stores has dropped from 160 in H1 2012, (a fall of 75%) because more shops are opening on the High Street alongside fewer closures.

Nationally, the data revealed that 3,366 stores closed while 3,157 opened in the first six months of 2013, compared to 3,623 closings and 2,670 openings in H1 2012.

Matthew Hammond, partner in business recovery services at PwC in the Midlands, said: “For the first time in recent years, the gap between store openings and closures is beginning to close. The figures represent the continuing transformation of our traditional retailers and store estates as they respond to the changing behaviour of their digitally-enabled customers.

“The high street needs to transform itself to be relevant to the “new normal” shopping behaviour in the same way that retailers are being forced to – these results hopefully show a step in the right direction.”

Analysis from the research further showed that charity shops, cheque cashing, betting shops, convenience stores and coffee shops were among those opening the most branches during the first half of 2013. By contrast, goods shops of a more traditional type (shoes, clothes and retail photographic shops), as well as recruitment agencies, banks and travel agents have been amongst the hardest hit in the six months to the end of June 2013.

“The shifts in multiple retailers’ store portfolios are a barometer for changes in our society and its habits. Closures in areas such as the photography sector reflect the sea-change in how consumers are spending and the well-publicised Jessops insolvency is stark proof of that,” added Hammond.

“Openings in areas such as cheque cashing and pawnbrokers reflect a society where a sizeable part of the population is forced to turn to these types of borrowing for basic needs. And more convenience shops are opening as multiple grocers seek ways to increase further their market share.”

Matthew Hopkinson, director of The Local Data Company, added: “This analysis of openings and closures in the top 500 town centres shows how significant the changes are to the make up of our high streets. The good news is that the significant decline in chain retailer numbers in town centres in 2012 is slowing down.

“That said, closer examination of the data shows the significant ongoing decline of traditional shops with food, beverage and entertainment taking their place. The pressure from online competitors, supermarkets and ‘out of town’ providers will only increase.”

Openings and closures of multiple retailers by region across the top 500 town centres in H1 2013.