New forecasts predict 20,620 retail closures by end of 2020

Britain’s iconic high street has faced many challenges over the years, none greater than the coronavirus pandemic. But its resilience and chameleon-like ability to change has meant that despite devastating losses it is far from being lost.

As consumers begin spending again, brands will have to adjust to the new requirements and demands of a post-coronavirus shopper. The brands that survive will be those who embrace change. The brands that struggle to adapt will face a very uncertain future and may disappear from the high street forever.

To celebrate its history, review the impact of COVID-19 on present day high street brands and envision what the high street could look like in the next few years, the consumer spending experts at money.co.uk have created The 2020 High Street Report.

Report summary

  • Four out of five of the high street’s most popular brands were founded in the UK.
  • The UK’s oldest high street brands can trace their history back to the late 18th century.
  • More bricks-and-mortar retailers have gone into administration this year (by June 2020), than in the whole of 2019. Many of these firms have said the impact of COVID-19 was the ‘last straw’ for them.
  • Independent experts predict that we will see 20,620 retail store closures by the end of 2020, resulting in over 235,700 job losses. That’s an average of 56 closures a day.
  • The South East of England (outside London) is the UK region which has seen the biggest number of high street store closures since lock down began.
  • Almost 3 in 5 shoppers have said they are more likely to shop at stores selling locally-produced goods once lockdown is fully lifted, compared to before the pandemic hit the UK.
  • Al Fresco dining is likely to surge, with around a third of Britons saying they would be more likely to use a pub or restaurant’s garden, than sit indoors.

Although the picture looks pretty bleak for retailers and hospitality businesses operating from bricks and mortar stores, the empty spaces left by high street shops and restaurant chains does present an opportunity. 

Different businesses can now make a greater mark on our much-loved shopping streets.

Here are the five trends, which suggest what the high street may look like in the future:

1. Shopping local 

Almost three in five British consumers have made more use of local stores in their area to help them through the Coronavirus lockdown, according to research from business consultancy Deloitte Digital.

The study from late May 2020, also found that almost the same proportion said they will be more likely to spend at shops offering locally-produced goods once the lockdown has fully lifted, compared to before the pandemic hit.

So we’re likely to see a change in shopping habits, with customers more likely to shop local. 

2. Click and collect (with physical changing rooms)

Retailers who are able to offer a better customer experience beyond just online delivery are likely to be in a strong position once lockdown measures are eased.

Fashion retail offers an interesting glimpse into the future. While online ‘fitting rooms’ are increasing in popularity, one emerging trend is the introduction of physical fitting rooms at ‘click and collect’ points.

This means that customers can quickly try on clothes and return them easily if they are not quite right. This approach has the added benefit for retailers of getting stock returned quickly and in great condition, ready to be put back on sale at full price.

Elsewhere, Argos has seen an 8% jump in sales made using the ‘click and collect’ function in the year to 7 March 2020, according to the company’s latest annual results.

3. Al Fresco Dining 

A third of Brits say they’ll spend more on eating out than they did before lockdown, according to polling from YouGov in May.

Meanwhile, research from mid-June also found that punters will be much keener to use pub gardens than to eat and drink inside these facilities. 

With more people excited about experiencing hospitality outdoors, it looks like Al Fresco dining could be the way forward in a post-COVID world.

4. Zero Waste & Sustainable Shopping

Even before the pandemic hit, shoppers and diners had been making their voices heard about how goods and services end up in their hands. 

Customers’ concerns about sustainability, treatment of supply chain workers, and farming standards have been a powerful force in changing the behaviours of retailers and the wider service sector.

Some 24% of consumers surveyed by EY Future Consumer Index in April said that they will pay more for ethical products.

A separate study found that 64% of its 3,000 respondents (across 15 countries including the UK) were focusing more on limiting food waste and would continue to do so after the pandemic is over.

The research, carried out by the consultancy Accenture last month, also found that shoppers are prioritising personal hygiene and cleaning products, while spending less on fashion, beauty and consumer electronics.

Conclusion

The coronavirus pandemic has undoubtedly altered the way in which we shop, interact and live our day-to-day lives. As non-essential shopping has shifted from a leisurely activity to one which comes with social-distancing restrictions, it is unsurprising that some businesses have struggled to stay afloat. 

The long-term impacts of coronavirus are yet to materialise, but one thing for certain is that the pandemic has changed the great British high street forever.

Where the high street may once have been home to major fashion and retail brands, shifts in consuming spending may see the spaces repopulated with sustainable and ethical stores that cater for a new way of shopping.

As online shopping sales continue to boom, click-and-collect may find itself a permanent fixture on Britain’s high streets.

Instead of large chain restaurants, individual eateries with outside space may suit the British public as they look to buy local and stay socially-distanced. 

Although its appearance and the brands which live on our shopping streets will change over the coming years, the role of the high street as a central pillar for leisure and employment will continue to live on in one form or another.