As UK weekly online shopping reaches £1bn, a new report by e-commerce delivery specialist ParcelHero reveals home shopping will wipe out 50% of town centre stores and spell the end for many well-known retailers by 2030.
UK shoppers’ weekly online spending has reached £1bn a week - an increase of 26.8% on 2015 - and a major new report by e-commerce fulfilment specialist ParcelHero reveals the death of the High Street is much nearer than people think. The report - 2030: The Death of the High Street - says that by 2030, just 13 years’ time, the impact of online shopping and home deliveries will mean over half of today’s town centre stores, with all their familiar names, will be a memory.
ParcelHero's Head of Consumer Research, David Jinks MILT, said: "The number of familiar High Street names being drowned by the growth of the internet shows no signs of abating as Staples and American Apparel join the ranks of the fallen, and and M&S prepares to close 53 stores."
The report's main findings are:
Vanishing stores: Between 2020 and 2030 half of the UK’s existing shop premises will have disappeared. In 1950 there were 600,000 stores in the UK, in 2012 there were 290,000 and just 220,000 will survive by 2020 says The Centre for Retail Research. With home deliveries increasing exponentially, the decade from 2020 to 2030 will see a further 100,000 stores close if this trend continues and e-commerce grows exponentially, leaving just 120,000 shops on our high street.
E-commerce conquers all: By 2030 e-commerce will account for around 40% of all UK retail sales.
Tipping Point: Supermarket’s physical store sales will slump from 42% to 24% by 2030, and that’s not enough to remain viable. Superstores, department stores and other chains rely on volume because of their small margins. Many well-known store brands will reach tipping point, and will vanish from the high street.
Crumbling Department Stores: Department stores have crumbled under the attack of e-commerce; Alders and BHS will not be the only failures. Of the surviving 200 large businesses, 48 are already labelled in danger and 53 made a loss last year. How long can the sector continue?
Fashion victims: From Austin Reed to Viyella, clothing stores have rapidly disappeared from shop fronts, with Banana Republic set to slip from our streets next. In 2013 alone there was a net loss of 264 fashion stores from our High Street. The online fashion industry could reach £36.2bn by 2030 - 63% of the market compared to today’s 21%. Online retailers are stripping the shirt from the back of high street clothing stores.
Estate of the art: There are 17,972 estate agents on UK High Streets. In 2030 there may be none. The impact of the arrival of Rightmove and Zoopla puts the search in the hands of house buyers rather than at the mercy of town centre estate agents. As the internet becomes estate agent’s new shop window there will be little need for expensive town centre premises.
Don’t bank on it: As we move to online banking, around 9,000 bank and building society branches have been closed since 1989 – and more closures are planned. Names you’ll no longer see on the High Street frontages include the Midland, Abbey National, Bradford & Bingley, The Woolwich, and Alliance & Leicester (some brands survive as bank in-house mortgages).
The final chapter: Remember Borders, Booksetc, Dillons and Ottaker’s? The traditional high street book store industry is collapsing at 2.3% sales decline a year, with just 1,071 retail businesses remaining. We could have reached many bookshops' final chapter with just 535 left in our major towns and cities by 2030.
Cannibalising sales: John Lewis is one company pushing ahead online - 25% of its sales are now through the internet. Tesco’s revenue is £2.9bn online, second only to Amazon. E-commerce could save well-known brands, but these sales will be at the expense of companies’ own physical stores. Many retailers are congratulating themselves on better than expected sales over Christmas - but this included a 19% increase in online sales.
Back to the future: High streets must return to a Victorian model. Shopping should become a more social experience again with local food deliveries increasing, based on Uber-style crowd source Apps. Homes must also return to UK High Streets to prevent no-go areas after 6pm.
The full report is available at https://www.parcelhero.com/blog/news-updates/2030-dead-end-for-the-high-street
A fascinating interactive timeline charting the demise of favourite High Street brands can be viewed at at www.parcelhero.com/highstreet