More than 8,700 chain stores have closed in 2021, analysis shows – The Guardian

Retail industry

Pandemic and shift to online shopping has hit demand for high-street shops, with fashion stores the worst affected

More than 8,700 British chain stores closed in the first half of 2021 as a combination of the coronavirus pandemic and the shift to online shopping continued to hit demand for bricks-and-mortar retail, new analysis has shown.

The number of chain shop closures far outpaced the number of new openings, meaning that overall numbers fell by 5,251, according to the Local Data Company, a research firm. Fashion shops were by far the worst-affected category.

Shops were already struggling with a wave of high-street chain closures before the pandemic, with the loss of tens of thousands of jobs in stores as spending migrated online.

The pandemic accelerated that decline, although the latest data suggested that the overall pace of closures may be slowing, in a more hopeful sign for the industry. The 2021 net closures were lower than the 6,000 suffered in the first half of 2020, when the UK first imposed national lockdowns and 11,100 stores shut.

The number of new store openings in the first half of 2021, at 3,500, was the lowest since at least 2016, when the Local Data Company first carried out the same analysis. The research, based on visits to 205,600 shops, covered only retailers with five or more outlets.

The data also showed the effects of the work-from-home economy, with the logic of recent years flipped on its head as commuters stayed at home, and city centres were left empty. City centre shop numbers decreased by 4.3% during the year, worse than commuter towns and villages, which fell by 3% and 2.3%, respectively. In London, suburban areas fared better than the City and the West End, which had been favoured before the pandemic.

The bulk of the closures were on high streets, with 3,600 shops shutting overall. Retail parks suffered the fewest closures; they are generally accessible by car and are often anchored by supermarkets, homewares and DIY retailers, which have remained popular during the pandemic.

Lisa Hooker, consumer markets lead at accountancy firm PwC, which commissioned the research, said the government’s financial support – notably the furlough scheme that supported workers’ wages as well as relief on business rates paid by stores – had provided a “lifeline” to the retail sector and prevented an even steeper rate of closures.

“After an acceleration in store closures last year coupled with last minute Christmas tier restrictions and lockdowns extending into 2021, we might have expected a higher number of store closures this year,” she said.

“However, operators are far from out of the woods and the next six months will be a make or break for many chains, particularly with the reinstatement of full business rates for all but the smallest operators, the winding down of furlough support and agreement yet to be reached between many operators and landlords on rent arrears.”












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