Warning of more exits from the UK high street

MORE famous names are expected to disappear from the high street in the New Year as shops struggle to pay their rent amid falling sales, according to a report published today.

Figures released by accountancy firm BDO show that like-for-like sales fell by 1.7 per cent year-on-year last month at “mid-tier” retailers.

The data excludes supermarkets and department stores, giving a more-accurate picture of life for high street retailers that can’t resort to discounts on petrol or food to draw in shoppers.

Analysts said the level of promotions being offered by shops is now on a par with the “panic sales” of 2008.

A host of familiar names disappeared from the UK’s high streets following the credit crunch and ensuing recession, with Woolworths and Zavvi among the biggest casualties.

Retailers are now racing to bring in cash to pay the next instalment of their quarterly rents.

Don Williams, head of retail and wholesale at BDO, warned: “Retailers will be hoping shoppers suspend austerity for the Christmas weeks to enable them to clear stock and have the cash to meet their usual quarterly obligations.

“Throughout 2011 we’ve seen the high street polarising between high performers and strugglers. The former are surviving despite the tough climate, but the latter have found failing to offer consumers high levels of service and innovative, new products at the right prices is a quick route to very quiet tills.”

A separate report published today by IGD Retail Analysis predicted that the value of the UK grocery market will rise to £184 billion in 2016, up from £156.8bn this year, driven by the growth in discounters, convenience stores and online retailers.

Department store chain John Lewis offered a ray of hope on the high street yesterday after sales rose by 9.6 per cent year-on-year in the week to 3 December. The total was flattered by last year’s heavy snow, but was also up 15.1 per cent weak-on-weak.

Capital Shopping Centres, which owns Braehead, near Glasgow, claimed its shops were welcoming “record” visitor numbers but declined to provide figures.