Can Christmas save Britain's high streets? It's complicated, experts say

Have you done your Christmas shopping yet? If not, you may soon be joining the (increasingly panicked) throngs of shoppers on Britain’s high streets. 

But last-minute gifters beware – don’t count on finding all of your favourite brands. 

It’s been a difficult year for some of the country’s biggest retail players. Ted Baker and the Body Shop both entered administration, following in the unenviable footsteps of Paperchase and Cath Kidston. Other high street titans like M&S and Boots are downsizing; according to one analysis released in September, around 38 stores close across Britain every day. 

Christmas is a bumper time for retail. But BDO – a consultancy firm that publishes a weekly ‘high street tracker’ – has warned of a “particularly poor” start to the festive season. 

“Within this festive period, retailers also continue to face increasing competition for the consumer purse,” said Sophie Michael, head of retail at BDO.

With the cost of living crisis continuing to erode spending power, retail sales fell by 5.3% in November, marking the worst performance for the sector since January 2021.

Such figures make for grim reading. But all is not lost. 

“Genuinely, I don’t buy the whole “death of the high street” narrative,” said Graham Soult, founder of retail consultancy Canny Insights. “It’s much harder to get yourself in the Christmassy spirit browsing Amazon at home on your phone.” 

What data exists seems to back this up. Last year, nearly six in 10 (58%) people planned to visit their local high street over the festive period. A majority (54%) said that they preferred to shop in a physical store than online.

According to a report published by the House of Lords’ built environment committee in November, our high streets might have “an optimistic and flourishing future”. 

High street performance is highly variable, said Paul Swinney, director of policy and research from the Centre for Cities – retail thrives in some areas, and fails in others. 

“There are a number of places where high streets are struggling, where there are lots of vacant shops,” he said. “But usually this is presented as a story that the high street is declining everywhere, and it certainly isn’t.

“I think if you were going to part of central London in particular, but also to the centre of Manchester or Birmingham or Brighton or Leeds, you would see that actually there isn’t a story there of a dying high street. There are lots of units that are filled, lots of people on the streets and people still going out to spend money.”

The successful high streets, Swinney adds, are the ones that have evolved, pivoting into “more food and drink type, experiential offerings”. 

According to new Centre for Cities data, visitor spend in UK cities grows across the country over Christmas, with an overall increase in 2023 of around 12% on the prior two months. Visitors want to “come in, have a coffee, wander around… it can’t just be retail”, said Swinney.

Christmas visitor spend is important: “If Christmas trade falls flat, it’s the final nail in the coffin” of a struggling high street, Swinney added. But how much visitors spend is not the only important factor in the year-round sustainability of these all-important places. 

In order to truly thrive, a high street needs regular, permanent footfall – and that only works when people live and work in city centres. 

“If you’re able to improve the strength of the city centre economy, and to make a more attractive place for office-based jobs to come and locate in – then you get a critical mass of a footfall,” Swinney said. “But beyond that, I think it’s a struggle to be able to turn that round.”

To do so, policy intervention needs to make the high street an attractive place to visit, Canny Insight’s Soult adds. 

“The last government invested many millions in town centre capital projects, but arguably neglected the things that would ensure those places are attractive to visit – for example, making sure councils have enough money to clean their streets; investing in police on the ground, to tackle shoplifting and anti-social behaviour; and maintaining the public transport connections that make it possible for people to get to those places,” he said.

“I think many people hope and expect that the current government will give those and other issues the attention they deserve.”

Business rates are also a major barrier to UK high street recovery. Based on property values rather than profits, these rates are especially high for shops in prime locations, straining their finances amid declining footfall and rising costs. 

Digital businesses operate from lower-cost warehouses – but high street stores face fixed costs regardless of sales performance. This tax structure needs to change, says Soult. 

“No-one disputes that businesses should pay their fair share, but shops, bars and restaurants are current taxed disproportionately compared to other industries. The new government promised reform – retailers are waiting for the action,” he said. 

Bustling high streets are also important to Big Issue vendors who rely on footfall to attract new and regular customers to buy the magazine to help them work their way out of poverty all-year round.

In the long term, only serious investment and policy reform will save the high street. But in the mean-time, consumers who care about it should consider popping down to their local retail area, rather than going online for their last-minute Christmas gifts. 

“I mean, there’s that phrase, use it or lose it, and certainly, you know if, if a shop isn’t receiving patronage it needs to stay open, it’s going to close,” Swinney says. “It sounds like a blindingly obvious thing to say, but it’s true.”

Do you have a story to tell or opinions to share about this? Get in touch and tell us more. This Christmas, you can make a lasting change on a vendor’s life. Buy a magazine from your local vendor in the street every week. If you can’t reach them, buy a Vendor Support Kit.