British retailing may be in “crisis”, after new figures from the Centre of Retail Research revealed that large high street retailers have faced a total of 5,834 store closures so far this year.
CRR said this marked a 77% increase from the entirety of closures in 2018, when 3,303 large retailers shut their doors. Some 708 of these retailers closed by going into administration, whilst 333 signed CVAs and 4,793 shut due to “rationalised operations in line with reduced customer demands”.
Meanwhile 9,750 independent retailers went into administration, and 753 were victims of rationalisation, which resulted in a total closure of 10,503 independent stores altogether.
The CRR confirmed that there has been a total of 130,148 jobs lost in the sector, and 16,337 units have shut their doors altogether.
The report also highlighted key issues that were impacting retailers in 2019. The first of these issues was high costs, brought about by business rates, growing rent and high labour costs.
It added these costs, as well as squeezed profit margins and heavy price competition, meant that retailers have also been hindered by low profitability.
Meanwhile low growth in consumer spending has encouraged significant growth in online sales, which has come “at the expense of the high street”. The CRR concludes that retailers have failed to prepare for these new challenges within the sector, thanks to “weak forward planning” and a failure to invest in stores.
The centre said: “The retail crisis in jobs, businesses, stores and high streets has been coming for a long time. Retailers who sell from physical shops have found consumer spending and profitability has been hit hard.
“Attitudes vary about whether this crisis represents an exciting change in how we shop or a dangerous trend that will vitiate our town centres and high streets.”