Shop closures drop - as Argos colludes with the enemy

Things are looking up for retailers, says new research - most of all for Argos, which has jumped into bed with eBay.

by Emma Haslett
Last Updated: 22 Nov 2013
The number of shop closures has dropped from 20 a day in the first half of last year to 18 a day in the first six months of this year, according to figures from PricewaterhouseCoopers and the Local Data Company.

The study, of 500 town centres in the UK, found the net drop in the number of shops (ie. the number of shops that closed less 3,157 new stores that opened), dropped by 78% year-on-year, from 953 in the first half of 2012 to 209 in the first half of 2013. Which supports figures showing things are beginning to look up for the retail sector.  

Apparently video and photography shops were the worst casualties – driven by the collapses of Blockbuster and Jessops. The shops with the most new openings were charity shops (which get an 80% relief on their business rates) and – weirdly – hearing aid shops, presumably doing a roaring trade as the population ages.

The worry is that the figures are still being skewed by the strong performance of London compared with the rest of the country. Because the figure is a net figure rather than a count of the total number of shops that closed over the six months, it hides the fact that in some parts of the UK, pawnbrokers and betting shops are opening as fast as other stores are closing.

‘Closer examination of the data shows the significant ongoing decline of traditional shops with food, beverage and entertainment taking their place,’ said Local Data Company director Matthew Hopkinson.

‘The pressure from online competitors, supermarkets and "out of town" providers will only increase.’

What’s clear is that shops are going to have to find a way to work with, rather than against, aforementioned online competitors. They could do worse than to take their lead from Argos, which today announced a six-month tie-up with eBay that will mean customers can pick up their online purchases from lockers in Argos stores.

Certain sellers - 50 have signed up, although eBay has not disclosed who they are - will be able to stick their parcels into lockers in Argos shops so customers don’t have to wait at home for their delivery/have their stuff sent to work/queue up for hours at the Post Office on a Saturday morning.

A similar system has already been tried out by Amazon, which puts its lockers in train stations, shopping malls and the foyers of some big employers.

In this situation, it’s a bit different: the lockers are in-store, effectively meaning Argos is colluding with the enemy. Then again, while customers are there, they might be tempted to have a flick through those laminated catalogues and get themselves a nice watch or Beauty Crystal Bow Declare Coin (a bargain at £9.99) while they’re at it. You never know: it could be win-win.

- Read our interview in this month's mag with online retail’s poster boys, Ocado founders Jason Gissing and Tim Steiner

Find this article useful?

Get more great articles like this in your inbox every lunchtime