PwC: One in ten chain shops in Scotland remain closed six months after lockdown

One in ten chain shops in Scotland are still closed six months after the lockdown which was in force in the first half of 2021, with 99 closing permanently, according to new research by PwC and the Local Data Company.

PwC: One in ten chain shops in Scotland remain closed six months after lockdown

However, in a sign of increased resilience, the number of shops welcoming back customers following the third lockdown was higher than after the initial closure in spring 2020, while temporary closures almost halved.

Retailers who have returned to trading will be hoping for strong festive trading, though in a further challenge import delays and staff shortages risk a Christmas supply crunch.

The research, which tracked activity across 1,863 Scottish outlets, shows that the rate of reopening following the end of the third lockdown period, which began on 5 January 2021 and remained in place until around the end of June, increased by more than five percentage points on the first lockdown with 88.5% of all chain stores reopening when restrictions were eased.

Of the remainder, 4.7% (99) closed permanently and 6.8% (114) remained closed temporarily, largely as a result of owners deciding the costs related to opening outweighed the potential revenues.

In comparison, the first lockdown, which began at the onset of the pandemic in March 2020, led to 4.6% of all chain stores in Scotland closing permanently, with 12.4% remaining closed temporarily after restrictions were eased.

High streets took the brunt of the permanent and temporary closures, with 5% of all shops on Scotland’s main high streets closing permanently and a further 8.2% remaining closed temporarily.

This means 86.9% reopened, compared with 90.2% of shopping centre stores and 94.2% of retail park outlets – highlighting how changing shopping habits are creating an environment in which high street retailers and landlords must come together and consider how to engage with a consumer audience drawn to retail parks and shopping centres, as well as the internet.

The data also show that other shops – those on suburban city streets, in smaller towns and villages and transit locations – had a reopening rate of 87.2%, with just 3.1% closing permanently.

The trends in Scotland are reflective of the rest of Great Britain. After the first lockdown 82.7% of shops reopened in GB, with Scotland marginally higher at 82.9%. After lockdown three, the rates increased to 88.6% and 88.5% respectively.

Jason Higgs, head of retail at PwC Scotland, said: “With the pandemic accelerating the shift to online retail, it’s encouraging to see so many outlets emerge from the third lockdown by opening their tills. However, as we enter the crucial festive trading period we may still be influenced by emerging Covid variants, and retailers are facing a Christmas crunch with potential shortages of stock driven by import logjams and staff shortages.

“Trading costs, from rents to employees to utilities continue to mount up, and for the bigger players, difficult decisions will need to be made over high cost but high revenue flagship stores in city centres.

“The near future will see companies further respond to changing consumer and employee trends and business needs, while discussions between landlords and tenants will have a huge say in how our high streets and shopping centres look - it’s never been more vital that landlords and occupiers negotiate early.”

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