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Customer Behaviour

Independent shops are opening at their slowest rate in seven years, with cafes, e-cigs and barbers on the rise and pubs, newsagents and Indian restaurants in decline.

According to data released by The Local Data Company (LDC) and British Independent Retailers Association (bira) independents opened the fewest number of shops in Britain’s top 500 town centres since LDC records began in 2009.

There was a net increase in independent shops of just +117 shops (+0.11%) in 2015 versus a peak of growth of 4.01% (+3,949 shops) in 2010.

Independents now account for 65% (-1% change from 2014) of all retail and leisure units in Great Britain.

Key growth sectors have been barbers, cafes, tobacconists/e-cigarettes, and hair and beauty salons. Sectors in decline include women’s clothing shops, pubs, newsagents and Indian restaurants. Tobacconists/e-cigarettes (+54%) and Hamburger restaurants have increased the most as a percentage – of their total occupied units.

In 2015 there was a net increase of +250 units versus a net increase of +200 units in 2014. Convenience retail (bakers, butchers, food shops and supermarkets) saw a net increase of +178 units (+0.66%) in 2015 versus an increase of 299 units (+1.14%) in 2014.

Traditional American restaurants selling hamburgers are also thriving

Service retail (health and beauty, financial services, tattoo parlours and estate agents) increased by the greatest number of units, albeit at a slower rate than 2014, at +1,037 units (+1.25% versus +1.30% in 2014).

Matthew Hopkinson, director at the Local Data Company, said: “Independents are a key component of our high streets and this is seen both in the fact they represent a majority (65%) of the units but also the diversity and vibrancy they can bring along with their direct connection to local economies.

“Whilst the numbers remain positive the dramatic decline in the growth of independents from eleven openings a day to just one a week reflects the challenges many independent businesses face.

Beauty salons are still one of the independent success stories on the high street

“A number of factors are at play but one of the major factors has been the move of many ‘high street’ anchor retailers such as Next, M&S and River Island moving from the high street shop out of town retail parks.

“These moves result in lower footfall volumes as people follow them out of town, which has a big impact for the smaller retailers left behind.

“2016 will be a pivotal year for independent births and deaths as history tells us that the ability to go from a large number of openings (+5,615 in H1 2010) to a large number of closures (-1,666 in H2 2010) in a short time is entirely possible. Only time will tell.”

Michael Weedon, Deputy Chief Executive of the British Independent Retailers Association, said: “Right under our noses great shifts in the composition of our high streets continue to develop.

Convience retailers, such as bakeries, are also increasing in number

“They happen in plain sight, immediately in front of us, yet are only visible in their full magnitude in the LDC data.

“While one in eight units changed hands last year, with more than 40 new independents opening every day in the top 500 towns and only slightly fewer closing, the balance produced only a tiny gain across the whole.

“But within the figures we see a powerful rebalancing away from product based retail towards service providers, leisure operators and convenience operators.

“For multiples the picture is different: of the four subsectors only leisure outlets increased in number.

“Very gradually we are seeing a new high street emerge, as always happens over time, as commerce adapts to ever-changing conditions.”

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