The "Death of the High Street": reason for concern or hidden opportunity?Bookmark this
It’s impossible to ignore the news regarding the consistent closing down of stores by multiple retailers over the past few years, equivalent to a net loss of more than 7,000 units over the past six years. So far, the largest loss was reported in 2018 with around 2,500 net shop closures. (Whelan, 2019)
High streets, shopping centres and retail parks are all experiencing the worst decrease in footfall and the highest number of empty stores in the last five years. (Clark, 2019)
However, despite information suggesting that the ‘Death of the High Street’ is a major concern, Richard Fleming, managing director and head of restructuring Europe at A&M, states that the reports have been exaggerated. Fleming believes that we’re now entering a new era of retail that provides opportunities for progressive incumbents, entrepreneurs and investors. (Whelan, 2019)
The consumer champion ‘Which?’ examined almost 1.5 million Ordnance Survey business records to observe the changes in the structure of Britain’s High Street from 2014 to 2019. (Johnson, 2019)
The conclusion implies that worries about the future of the high street might be overrated as most of them no longer look like ‘carbon copies of each other’ and well-known retailers are being replaced by smaller successful businesses.
With the growth of online shopping and the digital economy, it is time for services that cannot be offered over the internet to thrive.
While markets have noticed an increase in premises in the UK by over 50%, there is also a significant growth in cafes, snack bars and tea rooms (35.3%) along with fast food takeaways (23.2%). (Fitzsimons, 2019)
Furthermore, tattooing and piercing parlours increased their presence on the high street by 44% as well as hair and beauty services by 31%. (Fitzsimons, 2019)
Harry Rose, an editor of Which? magazine said that while the disappearance of so many well-known brands from the UK high street in recent years is a cause of concern, their analysis suggests that the future of town centres is not as pessimistic as the reports of store closures would have us believe. (Johnson, 2019)
Rose adds that with the evolution of shoppers’ demands and habits, companies must keep on top of the ever-changing trends and think how they can evolve with them, in order to continue to prosper on the high street. (Johnson, 2019)
The opportunity is there for developers to focus their attention on converting the spaces of once major retailers into something that cannot be replicated online, such as offices and residential units.
James Child, a retail analyst at Estate Gazette, reported that applications for conversion from retail to the residential units are up by almost 10% year-over-year, which results in an offer of 13,000 brand new residential units from nearly 1,600 applications. When it comes to London, one-third of shopping centres have plans for residential development. A situation that could be looked upon as ominous and concerning, reveals itself as an excellent way to bring people back into central locations whilst bringing us a step closer to the resolution of the UK Housing Crisis. (Andrews, 2019)
Andrews, S. (2019) Death or transformation: The future of the high street, Kisbridgingloans.co.uk. Available HERE
Clark, J. (2019) Major UK retailers suffer plunging in-store profit margins - CityAM, CityAM. Available HERE
Fitzsimons, J. (2019) Opinion: the death of big name brands isn’t a disaster for the high street, Lovemoney.com. Available HERE
Johnson, J. (2019) Death of the High Street is overstated, claims Which?, as analysis shows rebirth of independent shops, The Telegraph. Available HERE
Whelan, G. (2019) UK retailers' store-based profits halved, Drapers. Available HERE