How London’s high streets can weather the brewing retail storm

London rightly bears the distinction of being one of the world’s most attractive places to live and work.

But with that label comes risks as well as opportunities – and often, trends that we see across the country play out far more dramatically when it comes to our capital.

Take our latest research into the challenges facing the retail and leisure sectors across Britain’s high streets. We found that 14 shops are closing in Britain’s top 500 town centres every day, and four of these are in Greater London alone.

In the worst performing categories, every week two pubs and two fashion stores close in London, with Italian restaurants and furniture retailers also particularly suffering.

Retailer administrations and Company Voluntary Agreements (by which a company negotiates a way forward with its creditors, often involving shutting down outlets) in the retail and restaurant sector have led to many of the closures.

And we’ll be seeing more closures in the short term as a result of Company Voluntary Agreements already announced earlier in the year.

The continued rate of store closures reflects the new reality that many Londoners prefer to shop online, and eat, drink and entertain more often at home as opposed to on the high street.

That’s not to say that it’s all bad news. The capital is often the barometer for wider issues in the retail sector, and is also the proving ground for new initiatives.

So while the list of big chains that are rapidly shutting up shop is growing, it’s not surprising that we’ve also seen new forms of retail and leisure flourish, with juice bars, ice cream parlours, beauty salons and barbers opening new outlets to capture consumer demand for new leisure experiences.

However, the simple truth is that new openings just aren’t replacing the closures at a fast enough rate. Specifically, the openings across the “experiential” categories haven’t been enough to offset closures in the more traditional categories.

And it remains to be seen whether the recent packages of support for the high street, such as the reduction in business rates for smaller retailers we saw in the Budget, will make a substantial difference either.

Nor is this problem going to go away on its own. While consumer spending has been holding up, we’re not going to stop shopping online – it is simply too cheap, too quick, and too convenient.

It may well be a bitter pill to swallow, but London’s high streets may just need fewer shops. Some locations will need to look for alternative uses for their space. That could mean turning shops and restaurants into homes, community centres, or co-working spaces for startups, as was mentioned in the Budget last month.

Landlords, developers, and planners will have to work with central and local government to find the best solutions. After all, space in our cities is at a premium, so it’s vital that we find the best uses for it.

Retailers and leisure operators will also need to explore different business models that resonate with tomorrow’s consumers. We may see stores becoming showrooms to promote new products, and collection points for click-and-collect orders, while some restaurants may turn into kitchens to serve the lucrative and fast-growing home-delivery market.

Whatever the future holds, retailers and leisure operators will have their fingers crossed as they enter the peak trading period in the run-up to Christmas. And we can say for certain that the high street of the future won’t look the same as it does today.