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Fewer stores closing, but fashion multiples remain the most vulnerable

The rate of store closures slowed in 2013, but fashion multiples were still the most vulnerable, according to a report published this week.

The closure rate for retailers with more than five stores slowed from 20 a day to 16, according to the report by PricewaterhouseCoopers and the Local Data Company (LDC). The figures cover the top 500 UK town centres. Year on year, the number of net store closures fell by nearly 80%, from 1,779 in 2012 to 371 in 2013.

However, clothing stores and footwear businesses continued to be among the hardest-hit categories,  accounting for around two thirds of closures during the year.

By the end of 2013, there were 113 fewer womenswear stores than at the start of the year, and 83 fewer stores selling both men’s and women’s clothing. Footwear stores also dropped by a net total of 66 units, while accessories stores declined by 19. Menswear- only stores edged up by two.

LDC director Matthew Hopkinson told Drapers that much of the decline came from retailers reducing their store portfolio rather than companies going under, as businesses build their online presence and cut back on costly bricks-and-mortar estates.

According to Hopkinson, Arcadia Group – which includes retailers Burton, Dorothy Perkins and Topshop – shrunk its estate the most, ending the year with 1,473 stores, down from 1,586. He also highlighted others such as New Look, M&Co and Claire’s Accessories as having reduced their physical presence on the high street.

Some of the reductions also came from retailers shifting out of high streets – for example Next, which cut back by seven but added two out-of-town stores.

Hopkinson said: “What we are seeing is structural change – the traditional high street is disappearing into fewer locations – and often they are mega-malls and out-of-town stores.

“The rise of [Tesco’s] F&F and [Sainsbury’s] Tu, strong sales from the likes of Asos and Boohoo – that is the challenge these guys are facing.”

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