EUROPE – Fewer, larger, out-of-town stores represent the future of UK retail as greater spending power among the over-55s brings in an "age of considered consumption" over the next decade, according to a report commissioned by UK property firm Hammerson.
The report anticipates a 10.3% decline in total store numbers by 2020, and a 5.7% contraction of retail space, by 2020 amid a correction to current overcapacity.
In-town locations will take the biggest hit, with a 31% fall in store numbers, as High Street retailers move to out-of-town retail parks and major cities.
"The watchwords for retailers are fewer, bigger, best," said the report.
“It's no longer a case of putting products on shelves and expecting them to sell. Some [retailers] will need fewer physical stores than they used to. Others will need larger stores in the right location."
Meanwhile, the requirement for retailers to ensure all stores are trading well will result in portfolios focused on local demand and specific demographics.
In the next decade, over-55s will contribute 62% of an overall 26% increase in overall UK spending power, according to Hammerson.
At the same time, retailers will be forced to target "larger stores but in the right location" to capitalise on demographically driven, less impulsive spending patterns characterised by better information, convenience and lifestyle values.
Leisure will become a stronger element in 'destination' retail parks – an indication of over-55s' greater focus on shopping as a hobby.
"Consumers are increasingly looking to retail locations to provide more than just shops," said the report.