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UK could lose of a quarter of all shops

Following the recent demise of Oddbins, the fate of high street wine retailers looks fragile, with as many as a quarter of all shops in the UK predicted to be redundant by 2020, according to Tony Stockil, chief executive of e-commerce consultancy Javelin Group.

Speaking at the inaugural Retail London Conference last week, Stockil said: “The recession is only now hitting some retailers, so we will see more vacancies, which have trebled on the high street over the past five years.”

The rising costs of operating shops, increasing costs of raw materials and the rapid growth of e-commerce, were all cited as reasons for the change.

Online sales currently account for 8% of total UK retail sales – one of the highest rates in the developed retail world, with online sales in the UK forecast to reach over 10% by 2014.

“UK retailers understand the dual purpose of a website. For electricals, clothing and home-wares, customers are doing research as well as shopping online,” said Stockil.

“This is leading to a high level of store sales that can be directly attributed to the online channel, making the cross-channel effect very significant. It now accounts for 15% of clothing sales and 33% of furniture purchases.”

There is now a focus on exactly what role stores play in the multi-channel mix.

“Some retailers have predicted this and have been adjusting their business models accordingly. The “click and collect” model works so well for Halfords that the web is doing the work of the stores, meaning it needs fewer large stores to operate efficiently,” said Stockil.

Lucy Shaw, 11.04.2011

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