Four in ten shops will shut and property portfolios will reduce by 30-40% in the next five years as customers increasingly turn to online shopping over bricks and mortar, according to a report released this morning (21st March).
To remain competitive, chain stores will have to shrink the number of shops they have on the high street as more warehouse-style retail outlets crop up with free wi-fi for students to shop online, a report by Deloitte has stated.
Silvia Rindone, a director in the retail consulting practice at Deloitte and author of the Store of the Future report, said: “The majority of UK retailers have simply got too many stores.”
She also found that total floor space had dropped in recent years, which will continue as consumers shop more on the internet, with online sales forecast to reach £43bn by 2015, accounting for 14% of all retail sales.
Hugo Clark, a director in Deloitte’s real estate practice who advises retailers on their store portfolios, added: “The role of stores is changing but that does not mean they will be less important. The store of the future will be less about driving product sales and more about a holistic brand experience.
"Stores will need to redefine themselves as destinations, as spaces to interact with customers. However, the physical and the digital must not exist in isolation. A consequence of the fluidity between the virtual and actual store is that less physical retail space will be needed.”
In December last year retail expert Mary Portas delivered a report to the government giving 28 recommendations to improve the future of the high street, which Prime Minister David Cameron is due to respond to soon.