Rate of Midlands store closures slowing - PwC

More than 10,000 chain store branches disappeared from Great Britain 's retail locations in 2021.

In total, 7,160 shops opened, compared to 17,219 closures, a net decline of 10,059, according to PwC research compiled by the Local Data Company (LDC).

Although the net change has worsened since 2020, the number of closures per day has remained stable, 47 in 2021, compared to 48 in 2020.

A decline was expected with the ongoing impact of the pandemic and as large retailers, that were on the brink of closure at the end of 2020, exited the market for good.

Meanwhile, Government support for chain retailers was mostly phased out in July 2021 - adding pressure to those retailers reliant on grants.

The East Midlands saw 528 store openings and 1,146 closures, a net change of 618. In the West Midlands, there were 641 openings and 1,676 closures, a net change of 1,035 over 2021.

The overall number of openings has declined 26 per cent since 2019, the last year pre-pandemic.

So, although there were over 7,000 new openings in 2021, many of these were the natural churn and re-siting of existing stores. Apart from takeaways, at +81, and government job centres, +33, no other category saw more than 20 net openings in 2021.

In a continuation of a long term trend, store closures peaked in 2020 in the height of the pandemic.

The rate of closures has been growing since the mid-2010s, as more retail and service categories have shifted online.

This had previously been offset by the rapid rollout of leisure operators, such as coffee shops, food-to-go and restaurants. However, such openings have slowed down rapidly since the mid 2010s.

The number of closures is now expected to slow down through 2022. The last two years have seen a shake out of some large fashion and department store chains who were on the brink of collapse.

With these stores now closed, future store closures should begin to level off.

Moreover, bigger chain retailers are more likely to be proactively negotiating with landlords, so the end of the rent moratorium in March 2022 is less likely to affect them.

Since the pandemic, city centres and London postcodes have seen an acceleration in net closures as more people work from home or adopt hybrid working patterns. London is again the worst performing region by some margin.

Similarly, the underperformance of Birmingham has caused the West Midlands to perform worse than the East Midlands, with towns in the East Midlands more sheltered from the surge of Covid closures.

Many will be hoping that hosting the Commonwealth Games in the summer will see a reversal of fortune for Birmingham.

Sarah Phillips (pictured), Midlands retail & consumer markets leader at PwC, said: “Changes in consumer behaviour, changing patterns of working and the shift to online is impacting on both retail and service chain operators.

“Location matters most to consumers and whilst city centres and shopping centres falter as we have seen in Birmingham, retail parks and standalone operators have broad appeal.

“However, this summer 's Commonwealth Games will see a reversal of fortune for Birmingham. Multiple operators are taking note of this changing consumer behaviour and are relocating stores to where their customers need them to be.

“Many of the CVAs and administrations that took place in early 2021 have now been captured, including department stores, fashion retailers and hospitality operators that have left gaps in city and shopping centre locations.

“There is a pressing need to radically reshape and even repurpose towns and city centres plagued by these empty units and shopfronts.

“To regain lost footfall, high streets must understand why retail parks are so attractive to consumers or look for ways to better serve local needs, encouraging independent retailers and entrepreneurs to take this opportunity to grow into the gaps that are emerging. ”