More than 12,800 shops closed in the UK in 2024, a reduction from the previous year, but the rate of closures is expected to accelerate in 2025 due to increased costs imposed by Chancellor Rachel Reeves's budget, according to a new report from PwC.
The study, using data from Green Street, found that net closures were the second lowest in a decade, with 9,002 stores opening in 2024. However, higher operating costs, including a rise in the minimum wage and increased national insurance contributions from April, are forecast to drive faster closures this year.
Kien Tan, senior retail adviser at PwC, said: “Announcements by retail and hospitality operators over the past couple of months suggest that many of them are being more cautious with their opening plans, partly because of higher operating costs following last year’s budget, which is why openings are likely to slow in 2025. New sites may be less viable.”
In 2024, chemists, pubs, banks and car services accounted for half of all net chain store closures, with Lloyds pharmacy closures and the shutting of more than a dozen Wetherspoon's pubs significantly impacting numbers. Santander and Lloyds Banking Group have announced further branch closures this year.
Convenience store chains expanded fastest, led by Morrisons and Asda, followed by coffee shops, takeaways and budget retailers. PwC predicts that the number of shops and services in retail destinations will continue to shrink by 2% annually in the long term as key services like banks and chemists disappear.
