High streets have long been central to the culture, history, and economy of British communities. Despite their significance, many of these urban centres have been suffering from unprecedented levels of bankruptcies and store closures over the last few years.
This collapse is largely attributed to various factors including the shift to online retail, rising overheads, steep business rates, the increase in giant out-of-town shopping centres and retail parks, and most recently, the global COVID-19 pandemic.
The combined effects of these factors drove several high street retailers into liquidation while those shops that remained were forced to rethink their strategy.
The Rise of Online Shopping
Prior to the national lockdown, high street retailers were already experiencing periods of decline. E-commerce rapidly dominated market share thanks to its convenience, flexibility, and relatively lower prices. Customers find that in just a few clicks, they can do price comparisons, browse thousands of products from anywhere in the world, and get items delivered to their doorstep in no time.
According to data from the Office of National Statistics, online sales have been rapidly increasing since 2008. In 2019, online retail accounted for 20% of all retail sales in Great Britain.
With more consumers opting to shop online, countless brick-and-mortar stores have suffered and gone out of business. Unfortunately for high streets and storefront retail, the economic uncertainty brought about by the Coronavirus crisis would only accelerate this decline.
COVID-19’s Impact on Retail
At the onset of the pandemic, more than 17,500 chain store outlets in high streets, shopping centres and retail parks across Great Britain closed their doors for the last time. Even some of the world’s biggest retail chains were forced to file for bankruptcy.
More people became dependent on online services as non-essential shops were closed and stay-at-home orders were implemented. In fact, online sales grew to 28% of total retail sales in the UK since April 2020.
While non-essential shops in England including gyms, hairdressers, and outdoor hospitality reopened last April, high streets looked very different after months of slow sales and temporary closures. Limited in-store capacity meant continued declining sales while frequent disinfection measures added unanticipated costs and labour demands.
Towards a Post-Pandemic Future
Despite the economic havoc caused by COVID-19, all is not lost for the high street. Retailers may emerge from the pandemic stronger than ever if they evolve into more sustainable, digitally connected businesses.
The post-pandemic consumer will crave ethical and environmentally conscious brands. Storefront retailers must then be prepared to proactively seek what their customers want and adjust their product offerings accordingly. They must also capitalise on their online presence to engage with customers and drive foot traffic to their store.
It’s also likely that high streets would not only serve as shopping areas, but also community hubs. There would be a higher demand for establishments that promote sustainability and healthy social interactions. These include sustainable shops, green spaces, medical centres, art and entertainment venues, and other amenities a local community needs.
While it will take time for the economy to recover, retailers and local authorities can take this opportunity to reimagine our high streets into spaces that work for people.
For more insights or legal and security advice, book a free consultation now.