Adaptation is the key to department store success in the future. This is the stark message being sent out to the UK’s large high street stores following new research by commercial property information firm CoStar Group.
According to the findings, 83% of the UK’s department stores have closed over the past five years. The decline, which kicked off with the closure of BHS in 2016, has continued during that time, not helped by the impact of Covid-19.
Research shows that only a small proportion of department store closures over the past five years have been re-let, with definite plans or approval for a change of use.
Speaking about these findings to the BBC, Mark Stansfield, CoStar Group’s head of analytics said: “The data undoubtedly highlights the acceleration of change in the retail sector in recent years, which the pandemic has only exacerbated.”
However, Stansfield doesn’t believe these spaces will remain empty for long.
He continued: “We are increasingly seeing forward-thinking real estate owners getting ahead of the problem and reshaping what are key assets in our town centres to provide a focal point for regeneration.”
“I think we’ll see many more plans come to light in the coming months. With these store closures come new opportunities.”
As retail has increasingly moved online, physical department stores have suffered. This hardship was accelerated during the coronavirus pandemic, with 118 Debenhams stores closing and John Lewis cutting its stores from 50 to 34.
Department store retailers still operating now need to adapt in order to survive. According to Paul Kirkland, Fujitsu’s retail and hospitality development director, Department stores need to “move into new channels”.
As Kirkland explains: “With the right omnichannel mix they can still thrive across stores, online and invest in the right blend of people, fulfilment, logistics and supply chain infrastructure. If customers are confident that in-store offerings will mirror the online, it will satisfy them at every touchpoint.
“After all, choice has never been so important.”
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