Retail administrations in 2012 saw the number of store closures of multiple retailers on the British high street increase tenfold compared to a year earlier, new data released today reveals.
Multiple retailer closures hit an average of 20 stores a day across town centres, according to data compiled for PricewaterhouseCoopers (PwC) by the by the Local Data Company (LDC), though analysis of the three months to February 2013 showed this number increased to 28 per day during the period, following the high-profile administrations of Jessops, Blockbuster and HMV.
Last year, a total of 1,779 multiple retailer stores disappeared from the high street compared with 174 closures in 2011 and Matthew Hopkinson, director of the LDC, anticipates a continuation of this trend in the year ahead.
“We can expect to see this trend continue and indeed accelerate in 2013 as more leases come up for renewal along with the ever increasing demands from consumers for space that delivers an experience good enough to pull them away from their technology devices,” Hopkinson warned.
“The end of 2012 and the beginning of 2013 has seen the most dramatic period on record as companies controlling more than 1,400 shops went into administration.
“Will the discounters, pawnbrokers, charity shops, coffee shops and supermarkets continue to fill a large proportion of these closing stores?
“Town centres will have to adapt faster than ever before to maintain their attraction to consumers.”
Store numbers fell by 2.7 per cent following a decline of 0.25 per cent in 2011 with clothing retailers, jewellers and sports goods stores among the hardest hit, with the likes of Peacocks and JJB Sports collapsing into administration during the year.
While such figures are a worrying indication of the state of the British high street, retailers must do more to capitalise on opportunities within the digital space if they are to succeed, experts have said.
Christine Cross, Chief Retail Adviser to PwC commented: “Although the figures are more disappointing than many had hoped, we have to acknowledge that several of the companies with closures had anticipated these for some time.
“What is surprising is the speed at which stores have been picked up by value and grocery retailers in particular. Good businesses with good operating models and good people don‘t fail.
“While rates remain high, there is still a need for retailers to address cyclical cost increases and, even more, structural changes in ways of doing business.
“Today‘s customer does not differentiate between where they heard about, researched, saw, purchased or returned a product.
“They expect to be able to affect every part of the shopping transaction from any channel.
“This is the age of the total retail experience and it demands a very different operating model to be successful.”