Pulse of the High Street

Newsletter October 2012

Info from the Local Data Company:

So the big question everyone is asking us is, how is the increased closures of multiple retailers and the slowdown in independents expansion going to impact vacancy rates and where? Analysis of the first half of the year shows that a NET 953 multiples closed in the top 500 town centres, versus a NET 175 closures for the whole of 2011. This reduction would have been greater if we had not seen expansion from £ shops, pawnbrokers and cheque cashing operators. Of interest is the slow down in the growth of convenience stores, which might imply saturation, but then again Little Waitrose, M Local and others have rollout plans in action. Outside of town centres, the real area to watch is the role of petrol stations as the next new retail hub. The fact so many of us have cars and the need on average to refuel weekly has not been missed by the supermarkets and others, including Starbucks as they launch their drive through offer.

Independents now account for 67% (+1%) of all high street units and as such are heavily exposed to the declining footfall in town centres that will be further impacted in those towns where multiples are exiting. The good news is that despite these challenges, including rising rents, rates and parking charges, independents still managed to grow by 0.8% in the first half of 2012. This is a NET increase of 852 by number. The leisure and service sectors were the main drivers, with growth from cafes, nail salons, tattooing and piercing, takeaway food shops and pawnbrokers.

Whilst this highlights the dying and thriving sectors, it is more important to note that these changes are creating a fundamental change in the appearance, function and perceived health of our high streets. Every town is changing in a different way but what the data shows is that traditional 'comparison goods' shops are closing and being replaced by discounters, non internet services and alternative forms of 'banking', such as cheque cashing and pawnbroking. The overall long term impact on the traditional businesses still in place is being played out and one that we will continue to track with our army of field researchers.

Finally, the national shop vacancy rate for September showed a marginal decrease of -0.01% to 14.57% which is positive news but in light of what is said above, is this the calm before the storm?

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