UK shop closures at record 11.3%, highest in 15 months

UK shop closures at record 11.3%, highest in 15 months
More than one in 10 shops in British town centers are closed, as sales continued dropping and costs surged according to a survey from the British Retail Consortium (BRC) and Springboard market research.

The national town centre vacancy rate in the UK hit a record 11.3% in October 2012 (high streets and shopping centers), according to the report. Northern Ireland was the worst affected region with the rate reaching 20%. High vacancy rates were also recorded in Wales (15.1%) and the North & Yorkshire (14.6%).

"This new high in empty shop numbers really sets alarm bells ringing,” Stephen Robertson, the British Retail Consortium Director General said.

The data comes as several retailers such as electricals retailer Comet, sportswear group JJB Sports, video games retailer Game and greetings card firm Clinton Cards closed hundreds of shops after becoming insolvent.

Robertson added: "Many retailers are battling stagnating sales and rising costs, and next year's threatened business rates increase can only make matters worse. If the Government wants to breathe life back into our town centers and ensure the retail industry can play its full role in job creation it needs to freeze rates in 2013”.

The research found out that the general footfall in the three months to October was 0.4% lower than a year ago, better than the 3.3% fall in the previous quarter. "It's a little more cheering to see footfall suffering less than in the previous quarter, but shopper numbers were still no better than a year ago,” said Steve Booth, CEO of Springboard.

The footfall fell 0.9% on the high street during the third quarter, while the amount of customers slightly rose at both out-of-town (0.2%) and shopping centre locations (0.1%). High street retail saw some boost in August supported by the Olympics, but experts say this temporary factor failed to change the downward trend.

“September's cold snap drew the crowds stocking up on warmer clothing. But, while the Olympics appears to have brought people out onto high streets, that didn't translate into a surge in spending," he explained.

The survey of retailers is in line with the findings of the Office for National Statistics, which last week showed retail sales fell 0.8% in October.
Experts say that traditionally October is a difficult month for retailers, as school holidays are over and winter weather drives people away from the streets. However, retailers are optimistic and expect the festive season factor will positively affect this figure in November and December.