More than 13,000 department stores closed in 2024

More than 13,000 department stores were permanently closed last year, with experts warning there would be “worse to come” in 2025 due to rising budget costs.

New figures compiled by the Center for Retail Research showed that retail store closures in the UK jumped by more than a quarter from the previous year.

He also predicts more stores will close this year as national insurance contributions rise and higher wages take a toll on local stores.

The center’s latest analysis found that 13,479 stores, the equivalent of 37 per day, closed their doors permanently during the calendar year.

This represents a 28% increase from levels seen in 2023.

Provisional data showed the vast majority of closures were to small, independent retailers, who have seen their financial support reduced during the Covid era.

The study found that 11,341 independent stores were closed during the year, an increase of 45.5% on the previous year.

Meanwhile, 2,138 stores were closed by major chains during the year.

The data also showed that more than half of all stores closed, 7,537 in total, were closed through retailers undergoing some form of insolvency process.

Major chains including Ted Baker, Homebase and Carpetright closed their stores after being declared insolvent during the year.

An additional 5,942 stores were closed through “rationalization” as part of cost-cutting programs. Retailers including Boots and Shoe Zone reduced the number of their stores during the year.

Professor Joshua Bamfield, director of the Center for Retail Research, said: “While the results for 2024 show that while the results for store closures overall have not been as bad as 2020 or 2022, they remain disconcerting, with even worse to come. in 2025.”

The Center for Retail Research said it expects store closures to total about 17,350 in 2025, with about 14,660 coming from independent retailers.

This is expected to be linked to an increase in national insurance contributions and the increase in the national minimum wage, announced in the October budget and which will come into force in April.

Small retailers will also face a significant impact from changes to the current reduction in corporate tax rates for businesses in the sector.

Commercial property firm Altus Group said the reduction in April’s business rates cut from 75% to 40% announced during the 2024 Autumn Budget will cause average shop rates to spiral from £3,589 to £8,613 for 2025/26.

Alex Probyn, president of property tax at Altus, said it was “unwise” to cut targeted relief after a difficult year for the sector.

He added: “Despite Labor’s manifesto recognizing the excessive burden that business rates are placing on our high streets, this burden will be significantly increased. »

There was positive news on Thursday when the co-op announced plans to open 75 new stores across the UK in 2025.