UK stores shutter as coronavirus continues to bite

With a second wave of the coronavirus pandemic underway, there has been a record increase in the number of shuttered stores in the UK, new British Retail Consortium/Local Data Company research reveals.

In the third quarter of 2020, the overall vacancy rate increased to 13.2%, from 12.4% in Q2. This was the ninth consecutive quarter of increasing vacancy rates.

Shopping centres fared the worst due to the higher proportion of fashion outlets, where consumer demand has been hit hardest. The uncertain climate has also meant that even those looking to expand are holding off making investments in new stores.

“The government’s business rates holiday has mitigated some of the impact of the pandemic on shop vacancies and local communities. If retailers see a return of 100% business rates next April, the consequences will be severe,” says Helen Dickinson, Chief Executive at the BRC.

“The government should ensure that rates bills reflect current market reality by continuing a level discount at 50%, thereby creating a more sustainable cost base for businesses so they can continue to trade and invest in recovery and longer term growth. Without this, there will be unnecessary store closures and the loss of thousands of otherwise viable jobs.”

Lucy Stainton, Head of Retail and Strategic Partnerships, Local Data Company, comments: “Whilst it’s not right to assume that this spells the end of physical retailing, it does reflect the immense pressure on operators trading through a pandemic.”

“This is compounded by the demonstrable lack of businesses looking to open new stores when sites become vacant.”