A latest report by PwC stated that a net figure of 10,059 stores ( 17,219 closures, 7,160 opening) exited high streets, shopping centres and retail parks over the last year. Good news here is that this is the lowest number seen in two years, though the report also states that vacant units in town and city centres are no longer being replaced by other chains owing to a “continued shift” to retail parks.
Over the past two decades, high streets saw closure of many brick-and-mortar stores. Even household names such as Woolworths, Debenhams and Topshop have disappeared from the streets, spurted further due to the rise of e-commerce.
As chain retailers have reduced the size of their store portfolios, independent retailers were also seen seizing the opportunity to occupy the vacated space. Since the start of 2017, the number of chain stores across the country has decreased by 5.97 percent, while the number of independent stores has increased by 1.28 percent, says a Deloitte report.
Pandemic only accelerated the trend further. With forced temporary closures, travel restrictions and social distancing guidelines, stores were further affected badly, especially places like cafes, pubs, salons and other non-necessary places.
Although convenience stores remained largely unaffected during pandemic, closure in vicinity implies lower footfall in the whole area.
(Photo by TOLGA AKMEN/AFP via Getty Images)
Association of Convenience Stores (ACS) chief executive James Lowman feels that closure in general is not good for c-stores.
“Around 10 percent of convenience stores trade on high streets and town centres and these stores often rely on footfall from shoppers who are on a wider shopping journey.
“When neighbouring businesses close, this inevitably has an impact on the overall numbers visiting the area and can have a negative impact on the store while the site is empty,” Lowman told Asian Trader.
While the recent trend and figures seem to indicate that the high street has come to a dead end in the UK, the assertion is not completely true.
It was predicted that the Covid-19 might give a fatal blow to UK’s declining high streets, multiple reports now show that the pandemic actually proved to be an equaliser in many aspects.
What’s happening where
Stronger city centres with large catchment areas saw a comparatively huge drop in footfall during pandemic. High streets in affluent areas were the worst hit with London and Edinburgh losing nearly a year’s worth of sales.
As per figures from Cities Outlook 2022, places like Oxford, Newcastle or Cambridge which before Covid-19 had relatively low numbers of empty shops on their high streets saw more closures than cities like Blackpool, Bradford or Doncaster, where the increase in vacancy rates was much more muted.
At the same time, high streets in suburbs, towns and villages remain unaffected as compared to those in London.
Retailer Anbalagan Perumal, who runs Family Shopper in Colsterworth, about seven miles south of Grantham, revealed how none of the shops in his area closed business in the past couple of years.
“I did not see any shop closures here during the pandemic. It’s a small village anyway with a small high street and with hardly a few thousand people,” Perumal told Asian Trader.
“Time was indeed very tough during the pandemic but in this village, no business was closed down."
Photo by NIKLAS HALLE'N/AFP via Getty Images
Similar views were echoed by retailer Anil Patel who runs Costcutter store in Chislehurst, a suburban district of south-east London, England, in the London Borough of Bromley.
“There are only about ten shops on my high street here. I did not see any closure during recent years. Not even during pandemic,” Patel told Asian Trader, stating that it seems “all the businesses are working fine”.
Retailer Simon Dixon runs Premier Express convenience store in Lower Darwen village in Blackburn. Being located close to a small industrial and a housing estate, the store benefits from plenty of passing trade.
However, Dixon reported “neither any store closure nor any new openings” during the past couple of years in his market town high street.
Situation, however, was a bit different in Hackney in London. Retailer Ankit Kumar Patel, who has a Premier store in the area reveals how he witnessed multiple store closures on his high street.
“I saw a few shops closing down,” Patel told Asian Trader.
“The shops that were closed on my high street were a nail shop, a Chinese restaurant and a cafe. Closure of the nail shop was obvious as there was no business during lockdown.
“The cafe and the chinese restaurant closed as they could not provide outdoor seating arrangement. Their takeaway sales also were not that great so they had no option but to close down,” Patel said, adding that businesses are now back to normal.
Photo by MIGUEL MEDINA/AFP via Getty Images
Post-pandemic, shoppers are now returning to the physical stores.
“Businesses are now back to normal. The shops that were closed also opened up. When other businesses are open and performing well, it helps my store as well as the whole area as each shop brings more footfall,” he said.
What Future Beholds
Rejuvenation of high streets is very much on the cards due to rising footfall post-pandemic as well as government’s schemes.
High street stores have long complained that they pay business rates based on property values of bricks-and-mortar outlets, a system that favours companies trading on the internet and those with large out-of-town depots.
In an effort to give them a boost, the government is contemplating introducing an online sales tax.
The government has begun consultation in the matter and is inviting arguments for and against such a move, the Treasury said in a statement on Feb 25, adding that no decision has been made yet in this regard.
One percent online sales tax could raise one billion pounds which in turn would go toward funding business rates relief, said the government.
Stating that high streets have been facing challenges for several years now due to change in shopping habits and rise of e-commerce, ACS has been calling on the government to “rethink the way that business rates are levied on bricks and mortar stores”.
“One of the biggest changes that the government can make to support high street businesses is a rethink of the way that business rates are levied on bricks and mortar stores.
“The government is currently consulting on the introduction of an online sales levy for online businesses, which we have previously called for as part of a rebalancing of the rates system,” Lowman said, adding that convenience stores on high streets and in town centres pay “very high business rates bills”.
Expectations are also high from the government’s upcoming Levelling Up White Paper that is anticipated to shed light on what the road to high street recovery will look like and how policy can help town and city centres to adapt to the changes brought on by Covid-19.
Various efforts are also seen on local levels. Like, East Suffolk Council cabinet is set to establish free high street Wi-Fi in 11 ‘digital towns’ after a successful trial run in Framlingham.
Photo by Peter Macdiarmid/Getty Images
Meanwhile, basic infra issues like lack of parking space continues to be one of the major hiccups in high streets especially in busy cities, majorly due to lack of space.
Hackney-based retailer Patel pointed out that lack of parking space is a huge issue in his area. He has raised with local authorities too though he does not expect much respite simply because “there is no space”.
“In the morning and peak times, there is quite a lot of traffic. Only if there was parking available around this area, people could have thought to stop and grab something quick. But, there is no option of parking in Hackney. I have spoken to the counsellors and they too say there is no option available,” he said.
Economics and strategy research consultancy Pragmatix Advisory and futures experts Trajectory were commissioned by the Local Government Association to identify how councils can help create resilient high streets. This January, they released a report and pointed out how pop-up shops and community events can be used as opportunities to engage visitors and thus diversify the high street’s calendar.
Another PwC report exploring what Britons want from high streets states that shoppers are most enthusiastic about more independent shops and restaurants (63 percent) as well as pedestrianisation (54 percent) and more green space (52 percent).
Acknowledging that there are challenges facing high street retailers, symbol group Costcutter, now owned by Bestway, believes retailers need to "invest in stores
and "focus on the customer experience". And Stocking fresh produce is one of the easiest key to attract more footfall.
Photo by Dan Kitwood/Getty Images
"Retailers cannot afford to sit still and simply ‘protect’ what they currently have. While retailers have seen increased footfall in recent years, they need a strategy in place to maintain it and grow even further," a Bestway spokesperson told Asian Trader.
"To succeed in this channel, you need to invest in your store and really focus on the customer experience element of retail. This means not simply sticking with the status quo and focusing solely on what you already have.
"Instead, diversify where possible – such as bringing in more fresh produce, so that you’re not solely relying on impulse to drive profit, and start looking at what the main trends are in the channel.
"Business rates and inflationary pressures such as rising energy costs are affecting all businesses on our high streets. Independent retailers have a challenging time ahead, which is why joining the right symbol group can help businesses not only survive, but thrive."
Conclusion
While the pandemic may have ‘levelled down’ high streets, it hasn’t radically altered the geography of successful and less successful ones. Those places which had the highest number of empty units pre-pandemic are still facing the biggest challenges. Bradford, for instance, has seen virtually no change in its vacancy rate, but despite this still has one of the highest vacancy rates in the country. At the other end of the spectrum, Cambridge may have taken a bigger hit, but still ranks among the bottom 10 places with the fewest vacancies.
The localisation trend that has been accelerated by the pandemic will continue to work in favour of high street c-stores, renewing their importance.
Lowman feels it is time that high streets should go beyond retail.
“High streets, retail parks and shopping centres all have to evolve to meet the needs of the modern consumer. The offer to consumers has to be more than just retail, it has to be a shopping, dining and leisure experience rather than just a journey.”
“There is definitely a future for all of these areas, but they have to respond to consumer trends to stay relevant,” he concluded.
High street, as per experts, is ideally placed to reinvent itself in response to the shift in working and shopping habits. The fragmented ownership, lack of centralised coordination, low rents and high vacancy rates- the weaker points of high streets also present new opportunities as they open up the space for new concepts and operators, making our streets a diverse as well as an exciting place.
Scottish business conglomerate Glenshire Group has hired Daniel Arrandale as its new Property Director.
Starting in the newly created role last week, Arrandale brings a wealth of industry experience to the business, including his most recent position as Acquisitions Manager for Asda and his previous position as Development Manager at EG Group.
“I am thrilled to be joining Glenshire Group in a period of tremendous growth, with many exciting opportunities on the horizon,” said Arrandale. “I’m looking forward to working with the existing development team to maximise the opportunities within our current estate, whilst also growing the business further with the acquisition of new sites.”
As part of Arrandale’s remit, he will oversee acquisitions, development, and growth for Greens Retail, Pizza Hut, and wider Glenshire Group property development and investment interests.
The bulk of Arrandale’s career has been as Retail Director at commercial agents Christie & Co, focussing on the convenience, forecourt and franchise markets. Arrandale served at Christie & Co. for 23 years.
Harris Aslam, Managing Director at Glenshire Group added: “We are very excited to welcome Dan into the Glenshire family. Having worked with Dan many times over the years on several transactions, I can confidently say his breadth of knowledge and experience in this sector will give us a huge advantage as we continue to expand our portfolio.”
Currently operating 27 convenience stores and 20 Pizza Hut franchises in Scotland, Glenshire Group has committed to significantly furthering new location openings in Scotland as well as bolstering their property portfolio.
Brewer Carlsberg is shifting some of its marketing focus to cheaper brands, it said on Thursday (31), as consumers in major markets bought cheaper beer and in reduced quantities.
The maker of Kronenbourg 1664, Tuborg and Somersby said beer sales volumes fell by 1.3 per cent in the third quarter, noting declines in China, France and the United Kingdom. Premium sales fell 0.5 per cent in the quarter."In Western Europe, there's no doubt that the average consumer is holding back," CEO Jacob Aarup-Andersen told Reuters.
"In Asia, China stands out as a market where the consumer is very weak. Most other Asian markets are actually okay," he said, adding the company had not yet seen Chinese stimulus measures having any impact on consumer behaviour.For years, brewers have relied on a strategy of developing and promoting their more expensive premium brands to offset an overall decline in drinking.
Aarup-Andersen said he remained confident in the long-term growth potential of premium beer and that the category will comprise a significantly larger portion of Carlsberg's business in a decade.For now, however, the company is adjusting its marketing.
"In markets where we are seeing a significant pressure on premium, we are reallocating some of our focus into making sure that we are promoting properly around the right mainstream brands," he said.
The world's third-largest brewer behind Anheuser-Busch Inbev and Heineken said third-quarter sales rose 1 per cent to 20.5 billion Danish crowns ($2.98 billion), compared with 20.7 billion expected on average by analysts in a poll gathered by the company.
Despite the shift in consumer behaviour, Carlsberg said it still expects full-year organic operating profit growth to be between 4 per cent and 6 per cent. The company lifted its full-year guidance in August.
Also on Thursday (31), the world's largest beer maker Anheuser-Busch InBev reported third-quarter profits, revenues and volumes behind forecasts. AB InBev's third-quarter statement highlighted stronger growth for its more expensive beers, like Corona, which grew 10.2% outside of its home market, Mexico, during the period.
Consumers now want a greater commitment from retailers in cutting food waste, refilling stations, sustainable packaging, and partnering with social purpose organisations, states a recent research, which also highlights that a good majority (69 per cent) of younger consumers are more likely to shop with what they see as socially responsible retailers though price sensitivity still plays a crucial role.
According to the findings, published in Vypr’s Consumer Horizon Report, reducing food waste is the most important factor for the majority of UK consumers (29 per cent), especially for Gen Z women aged 18-24 (38 per cent). More than a third (37 per cent) of men aged 18-24 said they needed food storage advice. A similar number of women aged 18-24 (33 per cent) want meal kits with the exact amount of ingredients included for them to cut down on food waste.
Refill stations for personal care, cleaning products, dry goods, and beverages are also in high demand. Consumers, particularly Gen Z women, are keen to use these stations, provided they offer a cost-saving of 6-10 per cent compared to packaged goods. The study indicates that older shoppers are less likely to use refill stations unless prices are reduced by 15 per cent or more, which Vypr said shows the importance of price in driving consumers to adopt sustainable shopping habits.
The third priority for brands and retailers is to adopt sustainable packaging. Awareness of eco-friendly packaging is high, especially among younger generations. Two-thirds of UK consumers say they expect to pay more for sustainably packaged products, and that figure rises to 86 per cent among Gen Z and Millennials. However, Vypr’s research suggests that while shoppers express willingness to pay more, price sensitivity still plays a crucial role.
Ben Davis, founder of Vypr, said: “There’s often a disconnect between consumer intentions and actions. Brands need to understand that simply offering sustainable options may not be enough if price points don’t match consumer expectations.
“For Gen Z and Millennials, sustainable products need to be competitively priced or risk losing long-term loyalty. We tested this by presenting products with and without the label ‘100 per cent Recycled Packaging’ and found price remained the key purchase decision-making factor for most consumers.”
Another factor in building loyalty among younger consumers is to showcase social responsibility. The research reveals that 60% of shoppers are more likely to shop at retailers that partner with food rescue organisations or promote a charitable cause. Among Gen Z and Millennials, this figure jumps to 69%, showing a strong preference for brands that demonstrate a social purpose.
The report also reveals that 85% of shoppers are willing to pay a deposit for reusable products, though it is younger consumers, particularly those aged 18-24 who express the strongest support for such initiatives.
The Consumer Horizon report which provides insights shaping retail, product innovation, and consumer behaviour going into 2025, can be seen here.
Sugro UK, the number one buying and marketing buying group*, in partnership with b2b.store, is thrilled to announce a further expansion of its existing E-Loyalty scheme programme, which has proven to be very popular with its members and retailers, by introducing E-Loyalty Extra Compliance and Execution scheme as well as E-Coupons.
The E-Loyalty Extra is aimed to boost compliance and execution at retail store level to drive new product launches, core range compliance, some exciting fixture trials with its supply partners and more! It will be available to all member owned and member affiliated retail stores within the group.
The E-Loyalty Extra loyalty scheme will be accessible by retailers via WhatsApp platform and will allow retailers to capture evidence of compliance by simply clicking “take photo” button.
With the addition of another digital enhancement introduced to the group recently – Coupon - based loyalty mechanic, members are now empowered to incentivise and reward customers, driving stronger consumer connections and fostering brand loyalty at a granular level. Retailers can now simply redeem a coupon at the point of check out. Another key digital development within the group is WhatsApp E-Presell which enables Sugro UK’s retail partners to provide advance product volume commitments for new product launches. This functionality is particularly powerful as it ensures that suppliers have accurate forecasts before product launches, enabling better stock availability from day one of product being available on the market.
The ease and speed of using WhatsApp for these commitments simplifies the presell process, ensures accuracy and strengthens relationships across the supply chain.
While other industry players may soon consider introducing similar digital tools, Sugro UK are proud to be at the forefront of enhancing retail-focused digital solutions. This early adoption not only ensures that Sugro UK members remain competitive but also guarantees them access to the best digital tools available in the market. These efforts are part of Sugro UK's ongoing commitment to delivering value to its members and empowering them with innovative solutions for growth and success in an increasingly digital retail environment.
Sugro Head of Commercial and Marketing, Yulia Petitt said: “I am delighted that Sugro UK members are now able to provide photographic evidence of retail compliance and in-store execution to our supplier partners, using a wide range of display and compliance criteria such as planograms, secondary displays, trials, and new product developments (NPDs).These digital features allow members to share real-time proof of execution, enhancing accountability and building supplier confidence. The launch of E-Presell functionality opens a huge digital advantage for the group which will benefit all – members, retailers and suppliers in gaining accurate forecast and ensuring product visibility in store from day one of product being on the market and with the ease of using WhatsApp, the entire pre-sell process becomes a much quicker and easier process to manage for all parties.
"The Group has had 18 consecutive years of growth and, once again, on track to deliver in 2024, with the year-to-date performance of +15% year on year and growth across all categories.” Rob Mannion, CEO of b2b.store, added: “The rate of innovation in the wholesale sector is increasing and these launches are further great examples of that. We’re particularly excited about the developments and different uses of WhatsApp in the industry, with more coming in the pipeline for 2025 – it’s a tool no wholesaler or buying group can afford to ignore because of the level of influence it’s having in the sector and there’s no sign of that direction of travel changing any time soon.”
Sugro UK is proudly owned by its 90 plus independent wholesale members, with a combined turnover of over £2.5 billion.
Expanding its footprint in the World Foods category, Paulig has acquired Panesar Foods, a prominent UK-based producer of sauces and condiments.
Founded in 1992 and headquartered in Tipton, Panesar Foods is a family-owned business with three production facilities, employing 308 staff and achieving a turnover of £59 million in the 2023 fiscal year.
This collaboration is expected to accelerate product launches and drive growth in diverse offerings, including sauces, salsas, marinades, dips, and condiments.
"We have collaborated with Panesar Foods for 17 years, and we are very pleased to welcome the company to Paulig," said Rolf Ladau, CEO of Paulig. "Today, our combined taste expertise and innovation skills unite around a shared ambition: to accelerate our international growth and expand our World Foods offerings."
Bill Panesar, CEO of Panesar Foods, expressed confidence in the partnership, stating, “As Panesar Foods becomes part of Paulig, I am confident that our ambitions for international growth will be realised, and the business will continue to thrive. We share a strong commitment to innovation and delivering high-quality, flavourful products, and I look forward to bringing even more delicious products to the market, together."
Jas Panesar, MD of Panesar Foods, echoed, “This partnership will allow us to reach new markets and deliver our authentic World Food flavors to a broader audience. We look forward to combining our passion for quality food with Paulig’s commitment to sustainability and innovation.”
All 308 Panesar employees will transition to Paulig’s team. Financial details of the transaction remain undisclosed.