A record 2,481 stores disappeared from the UK's top 500 high streets in 2018, compared to 1,772 the previous year. In total, 3,372 shops opened, while there were 5,833 closures, according to PwC research compiled by Local Data Company (LDC). 

Currently there are nine store openings by multiple retailers per day, a 17.4% fall year on year. This also represents a 44% decrease from the 16 stores per day opening in 2013.

Relative to 2017, the rate of store closures in 2018 remained at 16 stores a day. However, the shortfall between openings and closures reached its highest level since the beginning of the decade, as withdrawals from the high street were further dented by a historic low number of store openings.

Lisa Hooker, consumer markets leader at PwC, said: 'The results are clear - 2018 was a turbulent year for retailers with a number of high profile store closures.

“It’s interesting that the marked reduction in openings has accelerated the net closure trend. In categories as diverse as fashion and financial services, new entrants are able to gain share by launching online - enabled by technology and consumer adoption of mobile and e-commerce -  rather than be saddled with the costs and risks of opening on the high street.’

Hooker said the high street of the future will be a more diverse space, not solely dependent on stores. The analysis reflects this with the net growth of gyms and sports clubs, ice cream parlours and cake shops, in addition to initiatives to bring more shared office spaces and homes into what were traditionally shopping areas.

Categories traditionally among the risers in previous years, such as coffee shops, food to go, takeaways, jewellers and beauty shops, have all seen net declines in 2018 as over-capacity and economic conditions took their toll.

The top 10 declining business types are dominated by retailers and service businesses, most impacted by the shift to online. These include fashion and electrical retailers, many of which have lost share to prominent online retailers.

In addition, traditionally store-based services such as banks, estate agents and recruitment agencies, whose business is also increasingly undertaken remotely have all figured heavily. These three categories alone accounted for a net 473 store reduction in presence on the UK’s 500 largest high streets in the last year.

The analysis also observed a slowdown in leisure, in particular restaurants and pubs, which posted a net loss of 506 outlets, reversing three years of consecutive growth since 2015. Market saturation, cost challenges, and a shift in consumer preferences towards in-home leisure have exacerbated the impact on the sector, not only leading to closures but also discouraging new openings.

Looking at the first quarter of 2019, LDC data finds that closure rates remain high as 1,358 outlets closed alongside 849 openings. This is a direct consequence of company voluntary arrangements (CVAs), store downsizing and administrations announced in 2018 feeding through.

Zelf Hussain, retail restructuring partner at PwC, said: ‘Several national chains weathered CVAs or administrations as retailers toiled in the tough climate of 2018. Retail companies looking to survive let alone flourish in 2019 face an uphill battle.

‘We have already seen several casualties in 2019 and there will undoubtedly be more, most likely in all categories except for groceries.

‘Additionally, we believe CVAs are not the answer in isolation. Companies need solutions that fully address customer needs, represent sustainable cost savings and, if needed new money investment to bridge the lag between the cost of a restructuring and long-term performance improvements.’

PwC and the LDC’s analysis tracked 66,463 outlets operated by multiple retailers in 500 town centres, between 1 January and 31 December 2018.

Report by Pat Sweet