Net store closures in the Midlands are at their lowest rate since 2018, according to new data from PwC and the Local Data Company.
In the first half of the year, 266 shops opened across the West Midlands, compared to 516 closures, creating a net decline of 250, down from 566 in H1 2021. The East Midlands saw 223 openings, with 359 closures, creating a net closure of 136.
With the overall reduction at -1.4%, the West Midlands closure rate has improved and is in line with other regions in the UK, with the spread of closures across Great Britain at its lowest for over seven years.
A boost for leisure
One segment that has seen an improvement has been leisure, with operators making up three of the four fastest growing categories in GB.
Takeaways have been boosted by the growth of home delivery and their ability to operate throughout lockdowns and the pandemic. While restaurants have been one of the worst performers in the past three years, new chains have been able to expand quickly into empty spaces and take advantage of lower rents and pent-up demand post-lockdown.
While not categorised as leisure, DIY shops have taken advantage of home improvement trends formed during lockdowns.
Elsewhere, banks and financial services have continued to decline and have featured in the top 10 fastest declining outlets for the past seven years, except in 2020. With more consumers opting to use online banking and digital services, it is likely we will see this trend continue.
Other declining segments are charity shops and betting shops.
Sarah Phillips, PwC partner and consumer markets leader for the Midlands, said: “While the annual reduction of stores across the Midlands continues, the rate of decline is stabilising in the region, as it is across Great Britain.
“Following the challenges of the pandemic, it is pleasing to see operators in the leisure sector, such as restaurants, become some of the fastest growing categories within our analysis, and outlets like DIY stores and takeaways were able to respond positively to the changes in consumer behaviour brought on by the pandemic.
“Highstreets and shopping centres in the Midlands, and in Birmingham in particular, have seen many changes and some high-profile closures in the past few years. High streets across the UK have been battling against the rise in online shopping and digital experiences for some time, and this is reflected in retail footfall rates that remain at an average 10-15% below pre-pandemic levels.
“However, this summer’s Birmingham 2022 Commonwealth Games brought over a million people to the region and put a global spotlight on us. The impact of this has yet to be formally captured, but anecdotally retailers and leisure operators felt a positive impact. The region now has the opportunity to innovate and reshape its towns and city centres, to maximise on the momentum created by the Games.
“That said, as we move into the second half of the year against the backdrop of the cost of living crisis, there is no doubt that retailers and leisure operators will come under pressure again as consumers’ ability to spend decreases and operating costs increase. With the new Prime Minister now in place, many operators will be looking toward Government support to see them through the rest of the year and ensure the viability of many businesses moving forward.”