In the first half of 2024, data from PWC highlights a stabilisation in store closures across Great Britain.
- A total of 6,945 stores closed, averaging 38 per day, marking a slight increase from the previous year.
- Store openings grew slightly, indicating a slow decline in physical outlets as online transactions rise.
- Fashion retail demonstrated improvement in closure rates, though it suffered from unseasonal weather impacts.
- Footfall remains significantly lower than pre-pandemic levels, impacting profitability and sales of physical stores.
In the first six months of 2024, a total of 6,945 shops operated by multiples and chains closed in Great Britain, equivalent to 38 closures per day. This represents a minor uptick from the 36 shops closing daily in the corresponding period of 2023. However, the overall rate of closures appears to be stabilising, according to research from PWC.
Despite this stabilisation, store openings marginally increased from 24 to 25 per day. This increase provided a level of stability, with the net closure rate maintaining around the 1% mark biannually. This suggests a steady yet gradual decline in physical retail outlets, attributed to the growing trend of consumers opting for online shopping.
The fashion sector, specifically, showed a marked improvement in its closure rates compared to the first half of 2023. The net closure rate in this sector has slowed by nearly two-thirds. Nevertheless, unseasonal weather conditions adversely affected fashion retail sales early in the year, amplifying challenges faced by the sector.
PWC’s analysis reveals a further shift towards online retail in the first half of 2024, partly due to the unseasonable wet weather, which increased non-food online retail penetration to its highest since October 2021. Additionally, footfall is reportedly 15%-20% lower than pre-pandemic levels, adversely affecting the sales and profitability of physical stores and hospitality operators.
High streets bore the brunt of these challenges, with declining footfall in every month of 2024 except March, helped by the earlier Easter holidays. High streets recorded a net closure rate of 1.5% in the first half of the year, higher than the national average. Shopping centres also experienced fewer customers, albeit with slightly fewer net closures than the national average for the first time since the pandemic. Retail parks, on the other hand, reported improved footfall, with chain outlet numbers growing by 0.4% in the first six months of the year.
Lisa Hooker, a leader of industry for consumer markets at PWC, remarked, “It is evident that online retail is establishing itself as a mainstay, consistently outperforming physical stores.” She noted that brands are increasingly investing in data to understand consumer needs better and create engaging retail spaces that cater to contemporary demands for convenience and accessibility.
The data underscores a gradual shift in retail dynamics, highlighting the enduring impact of online shopping and changing consumer behaviours on physical stores.
