Retailers have too many stores and need to shutter shops in order to stay in business, according to a new report from business consultancy firm Deloitte.
The report estimates that online retail space already accounts for the equivalent of more than 60 million square feet of retail space, and that this is set to increase significantly.
Report author Hugo Clark, director in Deloitte’s retail estate team, argued retailers should adopt a proactive strategy towards closing stores - not just waiting until the lease runs out but as part of a “clear vision” strategy.
“The death of the high street is far from being a reality, yet stores are now just one part of a larger, more connected customer experience and many retailers are struggling to define the relevance and future contribution of their physical space,” he said.
“Shops now represent a potentially clumsy, fixed point in an increasingly mobile world. In many cases, they are slow and costly to adapt, expensive to operate and difficult to relinquish once surplus to requirement.”
Rightsizing the Retail Estate is the second report published by Deloitte this year that looks at fthe real estate implications of the changing retail sector.
Deloitte predicted in March that up to four out of ten 10 shops would have to shut in the next five years.