As a result of the increased popularity and usage of online shopping, UK retailers are enduring difficult trading conditions within high streets and shopping malls. Statistical data provided by BDO (UK’s High Street Sales Tracker) suggest that high street sales fell 2.3% in December; the UK’s fifth consecutive year of decline in retail sales. Comparatively, online sales increased by 21.4% with the week up to Christmas Eve recording a surge of 40%. This was driven by consumers gaining confidence in last minute deliveries stemmed from well placed online marketing.
Returning back to UK high streets and shopping malls, Debenhams are cutting jobs and anticipating store closures due to the poor trading period over Christmas (sales fell 2.6% at Debenhams’ established UK stores). Other retailers such as Marks & Spencer and Toys R Us are reviewing their portfolio of retail stores; where at least 26 stores are expected to undergo the insolvency process. Meanwhile, House of Fraser is seeking to reduce their rent bill by reducing their store sizes by 30% after a tough Christmas trading period. Clearly, high street and shopping mall retailers are in decline as consumers shift to online shopping. Therefore, retailers must adapt to this change in shopping habits amongst consumers if they seek to remain competitive within the UK retail market.