2016 saw a growth in tobacconists, beauty and food outlets across the South West

Almost 500 retail outlets closed across the South West during 2016 according to PwC research compiled by the Local Data Company (LDC).
However, despite 492 retail closures, there were 422 openings in the same period, leaving South West with a net deficit of just 70 outlets, a better performance than other GBl regions.

There are a number of positive stories for the South West, with more openings than closures in the leisure (5.9% compared to 5.0%) and convenience (7.4% compared to 6.9%) retail sub-sectors. Service-based retail businesses performed least well, with 9.1% closures compared to 7.4% openings – reflecting a downwards trend nationally in high street recruitment providers,  travel agents, estate agents, banks and insurance providers, which have increasingly moved online. 

When it comes to individual business types, the fastest risers in the region include tobacconists (a net increase of 8 units) reflecting the national growth in ‘vaping’ outlets, hairdressers (a net increase of 7 units), beauty products and opticians (a net increase of 6 units) and restaurants and bars (a net increase of 5 units).

Areas seeing more store closures than openings include Bath, Bristol, Cheltenham, Exeter, Poole and Yeovil.

Bournemouth, Cirencester, Newquay, Newton Abbot, Penzance, Sidmouth, Salisbury and Trowbridge were among areas seeing a marginal net increase in the numbers of outlets at the end of 2016 compared to the beginning.

Matthew Lister, retail specialist and director in PwC’s Wales & West region Deals team, said:

“"The research clearly highlights the changing face of town centres - leisure and experience destinations continue to replace traditional high street stalwarts. The insatiable appetite for fast food and coffee shops fills the void left by banks, mobile phone and clothing shops.

The research also highlights that the South West has suffered fewer net closures than other regions of the UK, including London and the South East. The recent business rate reassessments may support a continuation of this trend in 2017."

Table 1. South West overview (Source: Local Data Company)

 

Businesses in Jan 2016

Businesses in Dec 2016

 

Net Change %

Units Net Change

Bath

394

387

-1.78

-7

Bristol

604

598

-0.99

-6

Salisbury

234

235

0.43

1

Bournemouth

237

236

-0.42

-1

Cheltenham

321

311

-3.12

-10

Cirencester

109

110

0.92

1

Exeter

348

341

-2.01

-7

Falmouth

90

88

-2.22

-2

Newquay

86

87

1.16

1

Plymouth

315

318

0.95

3

St. Ives, Cornwall

52

51

-1.92

-1

Truro

179

176

-1.68

-3

Bideford

51

51

0.00

0

Blandford Forum

47

46

-2.13

-1

Bridgwater

88

88

0.00

0

Bridport

50

50

0.00

0

Camborne

54

53

-1.85

-1

Chippenham

132

129

-2.27

-3

Clevedon

38

37

-2.63

-1

Devizes

68

67

-1.47

-1

Dorchester

113

113

0.00

0

Gloucester

193

191

-1.04

-2

Honiton

47

47

0.00

0

Marlborough

71

68

-4.23

-3

Newton Abbot

108

109

0.93

1

Paignton

84

84

0.00

0

Penzance

90

91

1.11

1

Poole

180

175

-2.78

-5

Shaftesbury

39

39

0.00

0

Sherborne

59

55

-6.78

-4

Sidmouth

50

53

6.00

3

Stroud

88

87

-1.14

-1

Swanage

30

29

-3.33

-1

Taunton

228

230

0.88

2

Tiverton

70

68

-2.86

-2

Trowbridge

107

110

2.80

3

Warminster

52

52

0.00

0

Weston-super-Mare

143

140

-2.10

-3

Weymouth

119

120

0.84

1

Yeovil

163

158

-3.07

-5

Street

115

115

0.00

0

Brixham

33

34

3.03

1

Burnham-on-Sea

44

40

-9.09

-4

Chard

34

34

0.00

0

Christchurch

66

65

-1.52

-1

Exmouth

86

80

-6.98

-6

Glastonbury

19

16

-15.79

-3

Wareham

21

21

0.00

0

Across Britain

Tobacconists, health clubs and jewellers are among the retail chains growing at the fastest rate on high streets across England, Scotland and Wales during 2016. Takeaway food shops, ice cream parlours and American and Italian restaurants also thrived last year, as the high street continues to rebalance from shopping to leisure.

The research also reveals that the number of cheque cashing outlets,  clothing and fashion shops, banks, and insurance agencies all declined in 2016.

LDC’s analysis of out of town locations (retail parks) shows an opposite picture where chain retailers have continued to expand and in 2016 saw an increase of occupied stores by 307 (+3%). This number illustrates the structural change that has been taking place from many town centres to out of town retail parks.

Madeleine Thomson, retail and consumer leader at PwC, said:

“2017 will be a crucial year for retailers. The combination of price inflation on goods and groceries will mean that brand loyalty will play a more significant role than ever.

“However, with prices on the up and less disposable income available to the average GB consumer as a result, retailers will need to be versatile and savvy to increase footfall to their stores. Our Total Retail research** shows that almost half (48%) of UK shoppers buy online because they find it more convenient than visiting a shop. However, despite the fall in new store opening, consumers continue to place value on the in-store experience, with the number one in-store attribute being shop staff with a deep knowledge of their product range.

“As we look ahead, the ‘Total Retail’ experience looks to be defined as simple and streamlined; one that maintains a human touch, blending the best of technological advances with helpful and expert staff both in-store and online.”

Table 2. Top risers and fallers by business type in 2016 (Source: Local Data Company)

Risers

Net Change (Units)

Number of openings

Number of closures

Fallers

Net Change (Units)

Number of openings

Number of closures

Tobacconists

59

124

65

Banks & Other Financial institutions

-196

44

240

Health Clubs

46

90

44

Fashion shops

-167

239

406

Jewellers

38

111

73

Department Stores

-132

8

140

Hearing Aids

37

85

48

Clothes- Women

-121

66

187

Coffee Shops

36

158

122

Recruitment Agencies

-80

61

141

Take Away Food Shops

35

111

76

Clothes- Men

-62

32

94

Stationers

28

48

20

Mobile Phones

-61

88

149

Leisure chains (food, beverage & entertainment) continued to grow in 2016, with a net increase of +126 units (+0.78%). This net change was more than half of the +271 (+1.77%) new units in 2015 suggests the sector may be seeing early signs of saturation. Health clubs were the main winner in 2016, jumping from a net change of +6 units in 2015 to +46 units in 2016.

Convenience and service retail have seen an improvement in 2016, with 62 and 72 fewer closures than in 2015 respectively. In the Convenience sector this was driven by improvement in the performance of bakers shops and convenience stores.

Comparison goods retailers are under the most pressure across Great Britain with fashion stores, department stores and men’s and women’s clothes shops all among the seven hardest hit sectors. Jewellers are the main anomaly, with +38 (3.26%) new stores in 2016. Department stores were mainly hit due to the closures of all 164 BHS stores. It’s also facing challenges adapting to new consumer patterns (click & collect) and fast fashion trends, with online sales accounting for 40% of total sales.

The analysis of 66,807 outlets operated by multiple retailers* in the top 500 town centres across Great Britain found that overall volumes of activity (openings + closures) have fallen from 13,109 in 2012 to 9,964 in 2016 (-24%).

In 2016, 5,430 outlets closed the GB  high streets, a rate of 15 stores a day, a slight increase on the 14 stores a day reported to have closed in 2015, when 5,138 outlets shut. However, the number of new openings has fallen to a record low (12 stores a day) since research began, partly due to uncertainty in the market in the lead up to the referendum vote. This equated to a net loss (difference between number of closures and openings) of 896 stores disappearing from Great Britain’s town centres in 2016, the highest net decline since 2012 when there was a net loss of 1,761 stores.

Table 3. Openings and closures of multiple retailers by region across the top 500 GB town centres in 2016 (Source: Local Data Company)

Country/

English Region*

Number of store openings

Number of store closures

2015

net change

2016 net change

East Midlands

 289

 353

-65

-64

East Of England

 413

 411

-75

2

Greater London

 1,153

1,385

-67

-232

North East

193

 207

-46

-14

North West

 333

 410

-63

-77

Scotland

 254

 366

-59

-112

South East

 688

 870

-71

-182

South West

 422

 492

 -49

 -70

Wales

 120

 146

-1

-26

West Midlands

 332

 392

-19

-60

Yorkshire and the Humber

 337

 398

 -17

 -61

Total

 4,534

 5,430

-498

-896

Greater London saw the biggest increase in net closures across all the regions. The capital’s net loss of stores increased to -232 stores in 2016, from -67 stores in 2015. Competition for units and saturation in certain London suburbs, saw the number of store closures rise from 1,242 to 1,385 (+143 stores). Expected increases in business rate valuations effective in 2017 and price inflation is likely to see this trend continue.

The East of England was the only region to see an increase in the number of multiples in 2016 (+2 stores). This was driven by the new Bond Street development in Chelmsford, which saw John Lewis open as well as several food and beverage outlets (e.g. Prezzo, Wagamama and Cote) and retail brands (e.g. Fat Face, Joules and White Stuff).

Matthew Hopkinson, Director of The Local Data Company, said:

“Town and city centres have seen the loss of chain retailers for the last seven years so it is no surprise to see this trend continue. What is of concern, however, is the significant slowdown in openings of chains on our high streets with many favouring out of town locations where large store formats, free parking and lower costs play to the all important consideration of convenience. Conversely, however, 2016 did see the opening of big store out of town formats coming onto the high street such as Topps Tiles, B&Q and DFS. Costs of operating a shop be it people, taxes and rents have started to rise putting the importance of the right location right at the top of every retailer CEO’s mind.

“The significant loss of stores in London and the South East reflects the trend for fewer stores in high population areas, to stores in destination locations where instore experience and adjacency to other non-retailers, such as food, beverage and entertainment outlets, is what drives a successful shop.

“Leisure (food and beverage) outlets is the only business category that has seen growth in 2016 but this has also seen the significant slowdown in openings which is perhaps a reflection of a bubble starting to burst after years of significant growth.”

ENDS 

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