Retailers eye 17,000 high street store openings this year as customers ‘look local’ post-lockdown
New research by Barclays Corporate Banking reveals that 17,000 local high street stores could open in the next 12 months as British shoppers adapt to a post-lockdown world by looking local.
In the report, entitled Retail Unlocked, Barclays’ data shows that consumers have returned to physical stores with confidence since restrictions began to ease – 68% say they have felt safe, or very safe, to return to the high street.
A significant portion of the nation (40%) are planning to step up their in-store shopping over the coming year, and 41% say it is their favourite way to shop.
However, the benefits are most likely to be seen in local high streets rather than in big cities, states Barclays, whose research shows that home and hybrid working patterns will persist into 2022 for more than two fifths (44%) of workers, with 16% expecting to work entirely from home and 28% anticipating a part-home, part-office model. A quarter of consumers (25%) now say that the best way a retailer can appeal to them is to open stores in their local area.
As a result, many retailers are reviewing their location strategies. Barclays’ research reveals that 18% of retail businesses with 10 or more employees are eyeing community store openings, with each of them looking at five new premises on average. Cumulatively, there is therefore potential for up to 17,000 new local stores across the UK.
Karen Johnson, head of retail and wholesale for Barclays Corporate Banking, says: “Our report shows how innovative UK retail businesses are looking to build back better to meet the challenges of a reshaped and revitalised retail landscape. Ecommerce has been the undisputed winner of the pandemic, but not far behind are community high streets, as shoppers seek to ‘look local’ and support the stores on their doorstep. With the continuation of home working, this shows no sign of slowing down, and retailers are now looking at evaluating their store estates to meet local demand.”
Other findings from the report include: 29% of retailers are looking to entice more people back to physical stores by laying on experiences such as concerts and exhibitions; since reopening, over half (52%) of retailers are seeing an increase in the average spend of customers, with average purchases up +9% on pre-pandemic levels; the most in-demand items, according to 45% of retailers, are products that promote a healthy lifestyle; 38% of retailers report an increase in demand for sustainable products with a reduced environmental impact; 40% of retailers now employ data-led marketing to acquire more customers; and retailers are overwhelmingly optimistic about future growth, with 80% confident of growth over the next 12 months, including 41% who are very confident.
Karen concludes: “As our report shows, the contemporary customer expects retailers to serve their needs – for speed, convenience, locality and, increasingly among younger demographics, for a sustainable ethos. The ability to deliver on these expectations with minimal friction – often by leveraging data and technology – will be pivotal in deciding who will win, and retain, customers in the future. I am consistently impressed at how innovative, agile businesses are adapting their strategies to survive and thrive across the whole shopping journey.”