Chains disappeared from the UK high street at an average rate of 48 stores per day in 2020, as lockdowns pummelled the UK economy.
New data released by accountancy firm PwC with the Local Data Company (LDC) found that almost 10,000 chain stores disappeared from Great Britain’s retail locations in 2020. In total, 7,655 shops opened, compared to 17,532 closures, a net decline of 9,877.
Although a decline was to be expected in a pandemic this is the worst ever seen.
The findings starkly compare to five years ago in 2015, which saw net decline of just over 1,000, 50% more openings and 25% fewer closures than 2020.
Worryingly the real impact of the pandemic is yet to be felt, says PwC, as some stores "temporarily closed" during lockdowns, but considered as open in the research, are unlikely to return.
But while we wait to see the full impact of COVID-19 on store closures, its effect on consumer behaviours are also driving changes.
Retail parks have seen the smallest number of net closures of any location (453), compared to high streets (4,690) and shopping centres (1,791).
Footfall was already holding up better in retail parks before the pandemic due to their investment in leisure and some retail parks have benefitted by being anchored by essential retailers that have remained open, even during the tightest restrictions. But it’s also because they’re considered safer in the current environment: free parking means it’s possible to drive to the location (and avoid public transport), outdoor areas mean reduced indoor mixing and larger units allow for better social distancing measures.
Shopping centres by contrast, are often poorly located for consumers who want to shop local and travel less to city centres, and are more likely to host fashion retailers and chain restaurants, which are the number one and thee most hard hit categories for net closure in 2020.
Meanwhile, the drop off in high-street footfall has affected those multiple retailers located on high streets, particularly those in large city centres. However, this decline in multiples has been somewhat offset by growth in interest of local and independent operators.
Small towns, which have long been in decline at the expense of more populous areas and cities, are now also enjoying a mini-renaissance. Consumers now want to shop in these locations, and larger retailers want to be there.
There is greater regional disparity this year. Looking at absolute figures, London, South East and the North West have seen the most closures, unsurprising given those regions have more chain stores.
However, London has undoubtedly been hit harder than other regions, with a record 5.8% increase in net closures this year. Conversely, Wales, Scotland, East of England and South West, where retail destinations are less highly concentrated, have been more protected from closures.
Lisa Hooker, consumer markets lead at PwC, said: “The full extent [of the effect of COVID-19] will be revealed in the coming months as many of the CVAs and administrations in the early part of 2021 still haven’t been captured, including department stores, fashion retailers and hospitality operators that will leave big holes in city centre locations.
"Retail and leisure operators must take action to ensure they are in the right places, so they’re not left surrounded by empty units and shopfronts.
“However, there will be big opportunities for growth into the gaps that are emerging. After the global financial crisis we saw growth of discounters and foodservice chains that replaced exiting retailers. There is an opportunity for operators who can find the right location at the right time to thrive, even despite the current uncertainty.”
Watch: Disappeared: The UK high street names lost in 2020