Shop openings plummet in lead up to Brexit vote
The number of shop openings in the UK fell dramatically in the lead up to the EU referendum result, according to a report from the Local Data Company (LDC).
In January through to the end of June this year shop openings fell by 15% to 20,804.
Despite closures falling by 5% to 22,801, they still exceeded openings by 1,997, which is the reverse of the result in the previous year when openings overtook closures by 335 shops.
John Lewis is among the major names to scale back expansion. The retailer announced last week that it would stop plans to open seven more Waitrose supermarkets.
The vacancy rate, which indicates the number of retail sites standing empty, rose to 11.2% in June. The rate is the highest it’s been since it hit a high of 12.4% in 2011 followed by a steady decline since then.
The director of LDC Matthew Hopkinson said: “Growth slackened significantly in the half year leading up to the referendum at the end of June, taking the steam out of the gentle improvement in vacancy. Since the end of June we have seen the vacancy rate in leisure outlets inch upwards.”
Hopkinson predicted that retailers may not survive the rise in costs due to the depreciation of the sterling.
“Increased costs for retailers coupled with fierce competition and oversupply of shops is likely to see increased levels of distress and failure among retailers, with survival of the fittest being the order of the day,” he said.
The British Retail Consortium (BRC) released figures for August showing that retailers were underperforming the rest of the high street. The high street saw 0.1% more visitors in August than the same month a year ago, however these were attributed to restaurants and other nightlife venues.
The LDC report, based on visits to 2700 towns and cities, exposed a rift between the towns most vacant shops and those with the fewest.
Burslem in Stoke-on-Trent had the highest vacancy rate at 33.3% and Beaconsfield in Buckinghamshire had no vacant units.
The north-east has the highest percentage of long-term vacant units while vacancy rates were higher in Wales at 15.1% than Scotland at 12.1% and England with 11.3%.
London is the only region to have lost the number of independent shops and the only one to gain in the number of chain stores over the past half-decade.
“This new report sets the benchmarks for developments on the high street for the coming years which will see the UK exit the EU and strike out on its own…Whether this will be just a twitch in the statistics or the beginning of a long term reversal will become clear over the coming months,” said Hopkinson.