More than 1200 chain stores closed in Scotland last year

Closed shops. Credit: ITV News

Over 1200 chain stores closed last year as consumer habits continue to change, though the real impact of the pandemic is yet to be felt, according to new research.

According to the PwC study compiled by the Local Data Company (LDC):

The net change in store numbers (openings minus closures) was minus 4.1%, the worst performance in recent years, with the net closures higher than in any of the five previous years.

PwC said the study highlights the long-term impact of "digital migration" in the retail industry, but also how the full impact of the pandemic may not yet be felt given the extent of government support offered to businesses over the last year which has been keeping many afloat.

Jason Higgs, Head of Retail for PwC Scotland, said: "The bricks and mortar of Scotland's retail sector continues to be influenced by changing consumer habits, ahead of all else.

"This means we continue to see far more stores being closed than being opened. Though this year, we are for the first time beginning to see a discernible gap between city centres and shopping centres, which are faltering, and retail parks, which are performing more resiliently with a mix of big-name brands in convenient locations surrounded by ample free parking."

PwC said that in total there are 2,500 fewer chain stores in Scotland than at the end of 2015.

Last year, there were:

  • 883 chain store closures on the high street leading to a net loss of 432 stores - in percentage terms this is a net loss of 3.5%.

  • Shopping centres in Scotland felt the biggest impact in percentage terms with 279 closures and 103 openings leading to a 7.4% reduction in stores.

  • Retail parks proved to be the most resilient sector with 102 closures and 58openings, giving a net change of -3.2%, or 44 stores.

Experts suggested retail parks may be holding up better because they are considered safer in the current environment as free parking means it's possible to drive to the location and avoid public transport, while outdoor areas mean reduced indoor mixing and larger units allow more easily for social distancing measures.

Shopping centres by contrast, are often poorly located for consumers who want to shop locally and travel less to city centres.

Meanwhile, the drop in high-street footfall has affected chain stores located on high streets, particularly those in large city centres.

Mr Higgs said, "As we hopefully emerge from lockdown, operators will simply be aiming to survive rather than flourish.

"We can expect to see the full impact of changing working and shopping environment, while operators face additional challenges of making rent payments - and the return of landlord enforcement powers and creditor winding up orders - while covering the costs of reopening, general operations, and maximising revenues in what is set to be a fiercely competitive market."