A new report from the Centre for Retail Research has warned that over the next 5 years, the number of UK retail stores will fall by 22% whilst the share of online retail sales will rise from 12.7% in 2012 to 21.5% by 2018. Retailers with a strong web offering now need just 70 high street stores to create a national presence, compared with 250 stores just a few years ago.
In the report, “Retail Futures 2018”, the Centre for Retail Research has predicted that high streets could see 20% of their shops close down within five years as more people turn to the Internet for their shopping. Total store numbers will fall from 281,930 today to 220,000 in 2018.
Meanwhile the research organisation has revealed that the share of online retail sales will almost double, from 12.7% in 2012 to 21.5% by 2018. As the UK has the highest proportion of online retail sales globally, the report says that foreign observers are watching closely as Britain becomes a test bed for retail innovation.
The key catalysts for the looming high street crisis are reported as:
- Customers shunning the high street, with their share of consumer spending declining from 50% in 2000 to a predicted 40.2% next year;
- Fewer people shopping in-store, with online retail set to account for 21.5% of total retail sales, the highest online retail share in the world
- Retailers with a strong web offering now needing just 70 high street stores to create a national presence compared to 250 in the mid 2000’s
Professor Joshua Bamfield, Director of the Centre for Retail Research, says: “Retailers have to make clear and strategic responses to the changing pattern of how consumers shop, which includes tactical decisions about store numbers and locations. They also need to fully integrate these physical stores with their websites, smart phone offering and social media community coherently. I think retail stores will remain an important, although smaller, part of the shopping process as online retail continues to grow.”
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