Anthony Hilton: There's no end to the pain on the High StreetComments Off on Anthony Hilton: There's no end to the pain on the High Street
Unfortunately, they are unlikely to be the last casualties. Figures released in recent months by pace-setters such as Primark and Next show that even these leaders are finding things tough. Now research group Kantar Wordpanel has confirmed what many already thought on the basis of the anecdotal evidence: sales of clothing and footwear have declined for four months in a row and are now at their lowest for seven years.
No one is quite sure why, so they blame the usual suspects — the decision to leave the European Union, the unseasonably warm weather throughout autumn and the absence of any big fashion trend to drive sales. But the bigger truth surely is that although employment is high, so are living expenses — and most people do not have a great deal of money.
But High Streets really cannot cope with falling sales for whatever reason, and particularly when costs are rising as sharply as they are now. A huge amount of stuff is imported and the 16% fall in the value of the pound since the referendum has played havoc with profit margins.
On top of that, they are grappling with further rises in energy costs and the upward spike in the minimum wage — both of which are big issues.
In addition, business rates and rents only ever go in one direction.
It is too early to write off the sector, because how shops fare for the year always depends to a disproportionate extent on how they do in the run-up to Christmas, a race that will start once Hallowe’en is out of the way.
But it will not be easy — even this peak spending season is not what it was, partly because more and more presents are bought online, and also because shoppers now wait for the flash sales that retailers use to bring in the trade. And if sales fail to live up to the highest expectations, we must surely expect several more big-name closures when the rents fall due in January.