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High street shops closing at rate of '14 per day'

Sky News logo Sky News 09/11/2018
The high street in Walsall © Sky News Screen Grab The high street in Walsall

The crisis facing the high street is set to "intensify" after shops closed at a rate of almost 14 a day in the first half of the year, a report says.

It found store openings continued to lag the pace of closures in a period that saw several household names disappear and others seek emergency rescue deals to stay afloat.

According to the analysis of 500 high streets by accountancy specialist PwC and the Local Data Company, 2,692 stores were shut between January and June.

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Just 1,569 started up - a record low, the report said, because of plunging confidence.

The study concluded that town centres were enduring their worst period for five years.

The year to date has proved tough for the sector has it has battled the effects of rising costs from things such as rents, business rates and minimum pay requirements.

A pedestrian walks past a shop with a closing down sale promotion in Liverpool, north west England, on August 17, 2016. 
From computers and cars to carpets and food, Britain's decision to leave the EU is beginning to hit consumers in the pocket, having already spread uncertainty through the property market. The consequences of the shock vote have so far been mainly theoretical, but recent data suggest that the country's tumbling currency is about to reach the High Street. The Office for National Statistics publishes retail sales figures for July on August 18, 2016.
 / AFP PHOTO / PAUL ELLIS        (Photo credit should read PAUL ELLIS/AFP/Getty Images) A pedestrian walks past a shop with a closing down sale promotion in Liverpool, north west England, on August 17, 2016. From computers and cars to carpets and food, Britain's decision to leave the EU is beginning to hit consumers in the pocket, having already spread uncertainty through the property market. The consequences of the shock vote have so far been mainly theoretical, but recent data suggest that the country's tumbling currency is about to reach the High Street. The Office for National Statistics publishes retail sales figures for July on August 18, 2016. / AFP PHOTO / PAUL ELLIS (Photo credit should read PAUL ELLIS/AFP/Getty Images)

All that at a time when consumers have been feeling the pinch in the run-up to Brexit next year.

It has taken its toll on independent retailers but also larger chains.

Toys R Us and Maplin were two early casualties while Poundland and Coast have also collapsed.

CARDIFF, UNITED KINGDOM - APRIL 15: A Toys R Us store in Cardiff, Wales, UK on April 15, 2018 in Cardiff, United Kingdom. Toys R Us went into administration on February 28, 2018, with the loss of 3400 jobs. (Photo by Matthew Horwood/Getty Images) © 2018 Matthew Horwood CARDIFF, UNITED KINGDOM - APRIL 15: A Toys R Us store in Cardiff, Wales, UK on April 15, 2018 in Cardiff, United Kingdom. Toys R Us went into administration on February 28, 2018, with the loss of 3400 jobs. (Photo by Matthew Horwood/Getty Images)

House of Fraser was rescued from administration by Mike Ashley's Sports Direct.

Among those to seek the closure of stores to save cash include M&S, Mothercare, Debenhams and Carpetright.

A general view of the Mothercare store in Belfast city centre   (Photo by Paul Faith/PA Images via Getty Images) © PA Images A general view of the Mothercare store in Belfast city centre (Photo by Paul Faith/PA Images via Getty Images)

The casual dining sector has not been immune from the troubles with Jamie's Italian, Byron, Prezzo and Gourmet Burger Kitchen all requiring help.

The government used the budget to announce some support - with £1.bn pledged to cut business rates for smaller shops.

Gallery: High Street brands: Gone but not forgotten (Photos Services)

Critics responded by suggesting the chancellor should have gone further to immediately close a tax disparity between the high street and major online-only rivals.

The report said it was unclear whether the planned aid would be enough to help arrest the decline.

Lisa Hooker, consumer markets leader at PwC, said: "The continued rate of store closures reflects the new reality of that many of us prefer to shop online and increasingly eat, drink and entertain at home.

Video: Marks and Spencer report a drop in food and clothes sales (ITN News)

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"The high street is adapting to an overcapacity in retail and leisure space resulting from these channel shifts.

"Openings simply aren't replacing the closures at a fast enough rate. Specifically, the openings across 'experiential' chains, such as ice cream parlours, beauty salons and vape shops, haven't been enough to offset closures in the more traditional categories.

"Looking ahead, the turmoil facing the sector is unlikely to abate. Store closures in H2 (the second half of the year) due to administrations and CVAs (Company Voluntary Arrangements) already announced will further intensify the situation."

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