Cost of living crisis and the ever-increasing costs of running a shop are leading to store closures, British Independent Retailers Association (BIRA) stated today (14) reacting to the data released by PwC and the Local Data Company.
Bira, who work with over 6,000 independent businesses of all sizes across the UK, said that the high street faced 'unprecedented challenges' following the news of a decrease in stores across the country in 2023.
Despite the rise in new outlets opened by UK chains, the closure of stores continues to outpace openings, resulting in a net decrease of 5,000 stores.
Andrew Goodacre, CEO of Bira, expressed concern over the challenges facing independent retailers, and said, "Further evidence of how difficult it is for retailers on the high streets in the UK.
"Our own recent survey also showed more than 50 per cent of indies were concerned about 2024. We disagree that store closure was a result of a long-term trend of people moving online because since Covid restrictions were lifted in 2021, online sales have fallen. We believe store closures have occurred due to the cost-of-living crisis reducing consumer spending and the ever-increasing costs of running a shop, with many indies saying enough is enough."
The figures reveal a concerning trend with a daily closure rate of 14 stores, underscoring the challenges faced by both retail and service industries amidst the growing preference for online shopping. Despite 9,138 new openings last year, primarily driven by hospitality sites such as drive through coffee shops and fast-food restaurants on out of city centre areas, the closure of major chains such as Wilko, Lloyds Pharmacy, and Paperchase has contributed to a net decrease in retail presence across the UK.
PwC's analysis highlights the impact of "one-off" restructurings and failures at major retailers, further exacerbating the closure rate. However, out-of-town retail parks have shown resilience, buoyed by the emergence of new food outlets, while the expansion of electric vehicle charging stations has led to a net gain of 48 petrol stations.
The rise in new hospitality sites represents a rebound for the sector following the challenges posed by the pandemic. Despite this, the broader retail landscape continues to face unprecedented challenges, with independent retailers bearing the brunt of economic pressures.
Goodacre added that Bira remains committed to supporting independent retailers across the UK, advocating for policies that address the underlying issues impacting the retail sector.
