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Will town centre fashion shops go out of fashion?

Matthew Hopkinson is a director of retail research firm Local Data Company.

Matthew Hopkinson

Matthew Hopkinson

The fashion industry is worth £26bn to the UK economy, an increase of 22% since 2009, but the number of jobs in the sector is down by 2.4%, according to Oxford Economics research. As shops are a major employer it suggests that changes are afoot when it comes to bricks-and-mortar fashion outlets.

How fashionable are fashion shops? Local Data Company figures suggest they are less fashionable than ever. The number of town centre stores is declining three times faster than the national average, a significant drop when you consider that fashion continues to be a major footfall driver.

Analysis of the three main shopping locations (high streets, shopping centres and retail parks) shows that in the last 12 months there have been net closures on high streets and shopping centres (down 2% and 4% respectively) but net openings (5%) at retail parks, making out-of-town the only retail category in growth.

Breaking this down by retailer shows who is driving this change. New Look - the largest retailer in terms of stores with 570 in the UK - has shrunk its physical presence by 2% in town centres and shopping centres, but grown in retail parks by 4%. Next, whose sales are to be admired, is the next largest with about 500 stores and has cut its high street presence by 3%, remained stable in shopping centres and grown in retail parks by 4%.

No analysis would be complete without Arcadia Group, as it has nearly 1,500 shops but has reduced its high street presence by 10%, while in shopping centres it has decreased by 7% - yet in retail parks, it has grown by 10%.

So, on top of the net closures, retailers are tending to relocate away from several smaller stores to fewer, larger ones, which exacerbates the employment issue as fewer people are needed to operate the equivalent floor space.

All this is bad news for workers in this sector, and as technology accelerates these changes, many shops - and those who work in them - might find they have the fight of their lives on their hands.

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