More Independent shops open in H1 2014 than at any time since 2011

This week we published some analysis on the health of the independent shops sector. It shows that traditional independent shops and leisure outlets continue to increase in Britain’s town centres whilst the chains continue to retreat. Contrary to popular belief independent high street businesses have continued to grow every year since 2009 albeit in smaller numbers as the years have passed. In 2010 the net change (openings less closures) in stores grew by 4% and in 2014 this growth reduced to 0.37%. Comparison goods (non perishable goods) retailers have been the exception to the rule and have shown consistent decline since 2012 with a net loss of over 600 (-2%) comparison goods shops.

• In H1 2014 the net change in Independents was +432 units (+0.41%) versus +384 (0.37%) in H1 2013.

• In H1 2014 a total of 16,930 Independents either opened (8,662) or closed (8,268), up slightly on H1 2013 where 16,820 opened or closed.

• Comparison goods (non perishable goods) shops decline has increased to -0.58% (-0.52% in H1 2013). This is a net decrease of -190 units and an acceleration from H1 2013 where the net decline was -172 units.

• Leisure (restaurants, cafes, bookmakers & entertainment) uses have continued to grow but at a slower rate. In H1 2014 they grew by +142 units, which is +0.42% versus +186 units (-0.55%) in H1 2013.

• Convenience retail (bakers, butchers, food shops, & supermarkets) have remained stable with +113 units (+1.29%) in H1 2014 compared to +116 units (+1.36%) in H1 2013.

• Service retail (health & beauty, financial services, pawnbrokers and estate agents) has grown the most with an increase of 329 units (+1.10%) versus +254 units (+0.87%) in H1 2014.

• Key growth sectors have been tobacconists (e-cigarettes), barbers (male grooming), beauty salons, mobile phone shops and restaurant & bar.

• Sectors in decline include women’s and men’s clothing, newsagents, shoe shops and pubs.

• The South West continued to show the greatest increase of independents at +102 units (+0.95%)

• Greater London continued to see the greatest decline of independents at -59 units (-0.18%)

• The North East has shown the greatest change in fortunes reversing a net decline of -0.27%% in H1 2013 to positive growth of 13% in H1 2014.

• Caledonian Road, London has the highest percentage of independents at 0%.

• Salford is the location with the least percentage of independents (clone town) at 4%.

Independents continue to account for 66% of all retail and leisure units in Great Britain.

Top 10 business openings by classification mix

Classification	Net Change %	Net Change (Units)
Tobacconists	78.29	119
Barbers	4.32	100
Beauty Salons	4.82	84
Mobile Phones	9.23	74
Restaurant & Bar	5.81	60
Cafe & Tearoom	0.89	59
Tattooing & Piercing	5.52	47
Hair & Beauty Salons	2.52	45
Nail Salons	3.78	43
Secondhand Shops	12.39	43

Table 1. Largest amount of Independent units opened by business type in H1 2014.

 

Top 10 business closures by classification mix

Class Group	Net Change %	Net Change (Units)
Clothes – Women	-3.29	-60
Newsagents	-2.94	-51
Clothes – Men	-4.51	-41
Shoe Shops	-4.91	-39
Public Houses & Inns	-1.14	-38
Internet Cafes	-11.54	-33
Restaurant – Indian	-1.59	-29
Sports Goods Shops	-6.42	-28
Night Clubs	-3.16	-28
Bride & Groom Shops	-4.98	-24

Table 2. Largest amount of units closed by business type in H1 2014.

 

National & Regional variations

East Midlands	0.97 (1.53)
East Of England	0.04 (0.05)
Greater London	-0.18 (-0.17)
North East	1.13 (-0.27)
North West	0.21 (1.31)
Scotland	1.58 (1.32)
South East	0.08 (-0.19)
South West	0.95 (0.45)
Wales	0.69 (3.29)
West Midlands	0.97 (1.49)
Yorkshire and the Humber	1.23 (0.35)
Total	0.41 (0.40)

Table 3. Net percentage change (openings-closures) of independent units by region in H1 2014 (H1 2013).

Top 5 Independent Towns

Caledonian Road, London	89.0%
Glastonbury	88.9%
Westcliff (Westcliff-on-Sea)	87.5%
Nantwich Road, Crewe	87.4%
Finsbury Park	87.0%

Table 4. Towns with the greatest percentage of independent retailers

Bottom 5 Independent Towns

Salford	24.4%
Bracknell	27.2%
Milton Keynes	29.4%
Solihull	29.6%
Cwmbran	29.8%

Table 5. Towns with the least percentage of independent retailers

This latest data on independents and last week’s data on the chains shows an increasing diversion in direction of travel with regards occupation of shops in town centres. Independents continue to remain positive, albeit at a reduced level from their peak in 2010 whilst the chains continue to reduce store numbers and are showing a significant increased closure rate which is heading in the direction on the year of peak closures, 2012, where net closures resulted in a net decline of 3%.

The growth in independents, the ‘silent majority’, is a significant factor in preventing vacancy rates rising in our town centres and also reflects the consumer response to a more personal and unique offer that many independents bring. The danger, however, is that the volume of openings and closures of independents versus chains is 300% greater resulting in a less stable high street and one prone to broad swings in performance based on business type and location.

Michael Weedon, Deputy Chief Executive of the British Independent Retailers Association, said “the rate of change on the high street continues to increase. The picture is invisible without the LDC x-ray machine, but what it shows once again is that major changes are taking place all the time, with over 8,000 independents closing and just under 9,000 closing in just six months. If that happened in the world of the chains it would be headline news. For the fourth year in a row the overall number of independents has grown, favouring formats which need customers to be in shops, such as food, leisure and services and hitting the “comparison” finished goods sector. The net gain is what’s slowly wearing the overall vacancy rate down but there’s a big warning in this data: the total gain in independents is slowing and if it turns negative overall vacancy will start to rise again. So, entrepreneurs are taking risks and opening new shops – everyone concerned with the future of the high street needs to do everything they can to help those new businesses survive. There’s a general election next year: this is the time for politicians to show the policies that will help nurture this new growth.”

Note: The total number of independent businesses in the top 500 towns is 105,427

The report’s findings were presented at LDC’s 3rd Openings & Closures Summit at the offices of Hogan Lovells, on 13^th October 2014 at 5.30pm by Matthew Hopkinson. It was followed by a panel discussion led by Samantha Fenwick (BBC Radio) with Michael Weedon (bira), Simon Danczuk MP and Chair of the APPG Small Shops Group, Professor Paul Longley (University College London, Hussein Lalani (99p Stores) and Mathew Ditchburn (Hogan Lovells).