High street faces toughest conditions in 5 years

High street faces toughest conditions in 5 years

high street

A new report by PwC has found has found that the UK high street is facing the toughest trading conditions in five years.

The number of shops, pubs and restaurants that have closed this year has surged to 4,400 in the first six months of 2018.

Fashion and electrical stores are being the hardest hit as shoppers are moving online.

Lisa Hooker, who is the consumer markets leader at PwC, said: “Looking ahead, the turmoil facing the sector is unlikely to abate.”

“Store closures in the second half of the year due to administrations and company voluntary arrangements [a form of insolvency] already announced will further intensify the situation,” she added.

Retail chains including House of FraserEvans Cycles and Maplin have collapsed into administration.

Other chains including Carpetright (LON: CPR), Mothercare (LON: MTC) and Homebase have had to carry out store closures and slash their rent bills.

Restaurants that have been affected include Jamie’s ItalianCarluccio’s and Gourmet Burger Kitchen as people are eating out less.

Pubs have also been hit in the current climate of the high street.

Brigid Simmonds, the chief executive of the British Beer & Pub Association, said: “Despite the positive measures announced in the budget, one in three pounds spent in the pub still goes to the taxman and pubs pay, per pound of turnover, more in business rates than any other sector.”

Fashion, however, remains the hardest hit with Patrick O’Brien, a retail analyst at GlobalData saying: “Clothing is where the shift to online is happening fastest. Over £7 billion of sales have moved online in clothing and footwear in the last five years. That dwarves any other sector.”

According to PwC, the greatest number of closures have been in Greater London, which had 716 store closures over this year and only 448 have opened.