More Tough Times For The High Street
Posted by Deborah Read on Friday 1 July 2011 in Finance
This week has seen an enormous amount of high street retailers either go into administration or close stores across the UK. What's happening? When the recession first hit, we all saw the damage to the high street. Woolworths was one of the first casualties, along with stores such as Coffee Republic and many more. The first recession Christmas was the harshest, many retailers seeing sales down from the previous year. What we didn't expect, was a new wave of stores closing. Jane Norman has gone into administration, followed by Habitat and Moben. Meanwhile, Carpet Right and Thorntons have said they will be closing stores around the UK. Surely the high street was showing signs of recovery? The economy is growing (very slowly, but growth none the less). So what's changed? The average UK worker has seen their take home pay decrease, making them financially worse off than thirty years ago. They have pay freezes imposed on their pay packets for potentially years to come. This will have a knock on effect on high street stores as consumers stop spending money on things such as furniture, clothing and treats like chocolate. The Royal Wedding boosted the high street but the retail industry is still stuggling to entice consumers to spend, who are also seeing the prices of food and fuel rise. Many consumers are ditching their cars all together in order to save money on petrol. All in all, it's still bleak. Consumers are also turning to online sites such as VoucherSeeker in order to get their discounts when shopping online, a neat little trick to ensure that they save money on more expensive items. The high street will continue to struggle until consumers are better off they won't start spending again.
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