Struggling retailers closing 20 shops a day
Friday 08 July 2011
Retailers are closing an average of 20 shops per day as squeezed consumer spending takes its toll on the high street.
Retail insolvencies shot up by 9 per cent to 375 in the second quarter of the year, with clothing stores, jewellers and bookshops the hardest hit, according to a report from PricewaterhouseCoopers (PwC) and Local Data Company, published yesterday.
Mobile phone shops, music shops and pubs and nightclubs are also struggling as the combination of rising inflation and looming government cuts drag household incomes to their biggest slide for three decades, according to some estimates.
A string of big names have either folded or committed to shrinking their operations in recent months. Former high street stalwarts such as Thorntons, Jane Norman and Habitat are all but gone, while the likes of Carpetright and Mothercare are cutting back.
According to the PwC research – which looked at 300 town centres across the country – since the start of the financial crisis, struggling retailers either have closed, or plan to close, on average half their portfolios.
There were some glimmers of light amid the doom and gloom yesterday. Supermarkets, convenience stores and cafés are bucking the trend with growth in the first quarter, while pawnbrokers, take-away restaurants and bookmakers also doing relatively well.
There are also stark regional variations in the PwC findings. The number of shops in Scottish town centres has fallen 30 per cent this year, with contractions of 19 per cent in the south-east of England, and 17 per cent in the West Midlands. But there have been big increases elsewhere – such as the 48 per cent rise in shop numbers in the south-west – leaving the total across the country slightly up over the year so far.
The latest "footfall" numbers from Experian, published yesterday, also offered some hope to retailers. The index shows growth of 0.2 per cent in the number of shoppers in June, the first year-on-year rise since January (although with the caveat that last June's numbers were depressed by the distraction of the World Cup).
But even before the financial crisis, retailers were feeling the pinch as shoppers increasingly looked for bargains online. In 2007, just 4 per cent of people were regularly buying on the internet, a figure that has shot up to 14 per cent, according to a survey of 1,000 consumers earlier this year.
Experts are predicting retailers will continue to struggle for the next six months at least, with clothes shops likely to continue to bear the brunt of the sector's difficulties. Mike Jervis at PwC said that retailers need to take drastic measures to ensure their survival. "They cannot afford to bury their heads in the sand, and must think about surgery before the problem becomes terminal," he added. "Retailers need to engage with their stakeholders early, especially banks, landlords, credit insurers and their staff."
- 1 'Kidnapped boy may have been abused and murdered by VIP paedophile ring,' say police
- 2 Ridley Scott on Exodus, Gods and Kings casting: 'I'm not going to get it financed if my lead actor is Mohammad so-and-so from such-and-such'
- 3 Girl, 7, gets Tesco to remove 'stupid' sign suggesting superheroes are 'for boys'
- 4 This letter from a reader explains why women can’t play football
- 5 'You should come to my house and eat cheeses with me': 4-year-old sends adorable love letter to girl at school
Black Friday 2014: Opening times for Asda, John Lewis, GAME, PC World and Argos
Miss Honduras Maria Jose Alvarado's stylist Luis Alfredo Garcia is found stabbed to death
Dr Lam Hoe Yeoh: Voyeur doctor jailed for eight years after using network of hidden cameras to film patients, colleagues and friends on the toilet
'You should come to my house and eat cheeses with me': 4-year-old sends adorable love letter to girl at school
Scientists predict green energy revolution after incredible new graphene discoveries
Ukip says babies born to immigrants in the UK should be classed as migrants – which would include Nigel Farage’s own children
Rochester by-election: Ukip gains second MP as Tory defector Mark Reckless holds seat
'Beast of Bolsover' Dennis Skinner takes Ukip MP Mark Reckless to task moments after he is sworn in
The young are the new poor: Sharp increase in number of under-25s living in poverty, while over-65s are better off than ever
Tamir Rice: 12-year-old boy playing with fake gun dies after being shot by Ohio police
Exclusive: UK approved £7m Israeli arms sales in six months before Gaza conflict
iJobs Money & Business
£6000 - £60000 per annum + Bonus and Benefits: Ampersand Consulting LLP: UI De...
£18000 - £23000 per annum + Comission: SThree: SThree, International Recruitme...
Negotiable: h2 Recruit Ltd: A rapidly expanding, global Software/ SaaS Vendor ...
£20000 - £25000 per annum + OTE £Competitive: SThree: SThree Group and have be...