Business bosses concerned as store closure rates accelerate

Three thousand more retail stores closed in 2023 than in 2022 according to the latest figures from the Local Data Company (LDC).

In 2023, there were 14,081 store closures across all retail sectors, which was a significant increase over 2022’s figure of 11,530. This meant there were on average 39 store closures every day.

Factoring in new store openings, which for 2023 was 25, that makes a net closure rate of 14 stores a day.

LDC attributed this acceleration in store closures to “one-off, large-scale restructuring in parts of retail and hospitality”.

The LDC figures show that the majority of new store openings were in retail parks and other out-of-town or edge-of-town locations, with the number of retail park openings growing slightly at +0.3%. compared with high streets, which saw a decline of 3.3%.

Reacting to the figures, Andrew Goodacre, chief executive of the British Independent Retailers Association (Bira), expressed concern that they showed the high street is faced with “unprecedented challenges”.

Andrew Goodacre, CEO, Bira

He said: “[This is] 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% of indies were concerned about 2024.”

Bira added in a statement that “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, which uses LDC data to compile the store closure figures, said it believed the figures mirror the proportion of people choosing to shop online for non-grocery items. But Bira’s Goodacre takes issue with that analysis.

“We disagree that store closure was a result of a long-term trend of people moving online,” he said, “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.”

At the Federation of Small Businesses (FSB), policy chair Tina McKenzie pointed to research they have carried out: “Our Small Business Index research has found particular cause for concern among hospitality and retail firms, which are trailing far behind the overall average in terms of confidence levels.

“Small businesses contribute an enormous amount to the economy, and a sustainable recovery will be built on their success and growth. Today’s news must be built on if it is not to turn into another false dawn for small firms.”

The LCD twice-yearly report is based on tracking 2,000 outlets in more than 3,500 locations, including high streets, shopping centres, retail parks and out-of-town sites.

Home > News > Business bosses concerned as store closure rates accelerate