High Street Crisis: Chain Closures Accelerating
The bloodbath on Britain's high streets has accelerated dramatically with the rate of major chain store closures increasing ten-fold, hitting 20 per day in 2012.
Analysis by PwC and the Local Data Company found that year-on-year, the net reduction in the number of stores climbed from 174 closures in 2011 to 1,779 closures in 2012 with the pace intensifying even further since.
A combination of factors - from the consumer spending squeeze to poor business models - is being blamed.
The rate of closures among independent shops is not even included in the figures.
2012 was a year in which a string of retail chains collapsed including Comet, JJB Sports, Ethel Austin and Peacocks.
They were joined, mostly after poor Christmas sales, by the likes of HMV, Jessops and Blockbuster.
Many were accused of being too tied to costly high street operations and failing to overcome strong supermarket and internet competition by selling attractively online.
The data also revealed that across multiple retailers in 500 town centres card, computer games, clothes, banks, health foods, jewellers, travel agents, recruitment agencies and sports goods shops were among the hardest hit in 2012.
Pound shops, pawnbrokers, charity shops, cheque cashing (payday loans), betting shops, supermarkets and coffee shops bucked the trend of a dying high street and actually showed growth during the year.
Additionally, analysis of the three months between December 2012 and February 2013 shows that the potential rate of closures - principally through administrations- would accelerate to 28 per day for this period.
Mike Jervis, insolvency partner and retail specialist at PwC said: "2012 saw more retail chains go into insolvency than ever before.
"The failed chains generally shared two problems - too many stores and too little multi-channel activity.
"A number of them had failed to deal with their underlying issues by hiding behind light touch restructuring processes, especially Company Voluntary Arrangements.
"2013 has seen the downward trend become even worse," he said, adding: "If underperforming retailers are to avoid becoming part of these statistics for next year, their shopping baskets should contain an acute knowledge of their customers and their customers' needs."
Those were, Mr Jervis said; "Robust cashflow planning; honest analysis of the performance of existing and potential new stores; the bravery to admit mistakes regarding products and stores before dealing with them; clinical attention to costs; early engagement with banks, landlords and suppliers; appropriate debt and capital structures."