SCOTLAND is bearing the brunt of UK high street decline during the lockdown with customer activity across the country dropping by nearly 40% on last year while permanent shop closures have now hit record levels and the Herald on Sunday can reveal.

New analysis shared with the Herald on Sunday which lays bare the crippling effect of lockdown on shops, pubs and restaurants across the country, reveals that as more and more people work from home and remain there during lockdown, the nation has with Wales seen the steepest regional drops in footfall over the past 12 months, raising fresh concerns about business failures and the end of the high street as we know it.

Research by the Local Data Company and PwC UK has revealed that net shop closures have hit record levels, more than doubling in Scotland in the first half of this year - and warn there is more pain expected.

The figures reveal that 703 chain operator outlets have permanently shut in Scotland this year so far, with 400 shops opening, creating a net decline of 393 a 125% rise on last year (176). It is the highest net decline for five years.

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Across the UK, the rise in net decline is around 75%, with 11,120 chain operator outlets shutting with 5,119 shops opening, creating a net decline of 6,001 up from 3509 last year.

The state of our shopping centres has come amidst amidst a challenging year for retail and leisure which has seen many stores have to close either temporarily or permanently as the impact of COVID-19 continues to influence consumer behaviour.

One of the casualties of the decline was Edinburgh Woollen Mill where more than 24,000 jobs are at risk while the business which includes Jaeger, Austin Reed, and Jane Norman – teeters on the brink of administration.

On Friday it was granted a further ten working days to speak to potential buyers and work on a rescue plan.

The retailer said earlier this month that it would go bust without filing for an intention to appoint administrators with the High Court.

Since then, bosses have started closing 50 stores with 600 job losses, while they work through securing backing for the rest of the business.

According to a memo, there is interest in parts of the business, understood to be the Peacocks and Jaeger brands.

But it is understood a further 100 to 150 stores across the group are being earmarked for closure while talks continue with landlords.

Bosses wrote to staff on Friday morning, warning them that the national and local lockdowns had hit sales very heavily.

In a note written to staff, the company said it had been a challenging time and thanked workers for their efforts.

Two years ago EWM, whose first retail store opened in Edinburgh 50 years ago, confirmed it was moving its head officer from Langholm, in the Scottish Borders to Carlisle.

According to Springboard, the consumer intelligence analysts, Scotland suffered a 37.8% drop in all shopping footfall since last year, a decline only bettered across UK regions by Wales, which has suffered a 38.1% drop.

HeraldScotland:

Least affected across the UK is the south west of England with a 22.6% decline, followed by the south east of England with a 24.8% drop.

And it is in the high streets that Scotland has really felt the footfall pain with a 20.4% drop in the week to October 11 alone - compared to a 4.5% decline across the UK.

Meanwhile footfall in Scotland’s retail parks during day time trading hours in September was just 7.7% lower than last year.

But there are warning of further closures to come - as the original coronavirus government support schemes for workers and businesses winds down this month.

PwC says that while its study doesn’t count ‘temporarily closed’ sites as closed, the full impact on our high streets and shopping centres will not yet be known.

"We’ve already seen announcements of chain closures and company voluntary arrangements, which are yet to take effect on high streets and shopping centres," it said.

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"Unless further government stimulus is announced, we’re guaranteed to see further closures as other external factors impact the sector. With further movement restrictions and local lockdowns almost certain, the furlough scheme phased out in October and business rates relief and VAT reductions for hospitality ending in March, what will shopping centres look like next year? And is there anything operators can do now to recover?"

Ewan MacDonald-Russell, Scottish Retail Consortium's head of policy accepted that the Covid-19 pandemic had let to a "seismic shift" in shopping patterns.

"Consumers have significantly increased their shopping online at the expense of physical shops. Even then, there is a huge disparity between retail parks and high streets," he said.

"The former, which can generally be easily reached by car have nearly recovered their pre-crisis footfall. However, town and city centres have missed out with office workers staying at home and consumers reluctant to use public transport.

"These changes are likely to have been exacerbated by the recent restrictions which further reduce the reasons to visit town and city centres. With the golden trading quarter starting and retailers desperate to attract customers to commit to their Christmas shopping, there is a lot riding on the next few months for the industry.”

Springboard says the greatest impact on the recent decline were compulsory closures of businesses due to coronavirus and other government lockdown restrictions.

On the positive side, Scotland's footfall strengthened in September compared to August, with footfall dipping by 32.5% compared to 36.2% in August.

"The start of the school term led to footfall shifting downward from -30.1% in the first week of the month [September] to -33.8% by the third week," it said.

HeraldScotland:

Springboard analysis

"This was then exacerbated by the introduction of greater restrictions on movement from the third week onwards, which meant that by the last week of September the decline in Scotland’s footfall reached -35.6%.

"By far the greatest impact of the increased restrictions has been felt by high streets in Scotland, which is unsurprising given the concentration of hospitality here."

In the second half of the month, following the compulsory 10pm closure of hospitality outlets, high street footfall in Scotland moved downward from -39.9% to -45.5%; compared with a slight improvement in shopping centres from -39.4% to -38.6% and a greater improvement in retail parks -14.5% to -10.9%.

The Springboard analysis shows that the greatest impact on consumer activity of the increased government restrictions is during the evening "which is exactly the desired policy outcome"

There was a far greater decline in high street footfall in Scotland post 8pm of -55.2% and -44% between 5pm and 8pm compared with -34.9% between 9am and 5pm.

"This suggests that for many hospitality operators who are missing their second sitting and therefore losing a significant proportion of turnover, a way forward could be to bring forward dining times and encourage customers to eat earlier," Springboard said.

"The earlier hospitality closure is a further challenge for large city centres in recovering lost footfall. Our data was the first to identify a far greater reduction in activity in large cities than in smaller high streets early on in the lockdown period as shoppers stayed local, and this is a trend that has been ongoing."

And it said that larger cities are being hit hardest by the increased restrictions, with footfall in regional cities declining by -5.7% versus -2.1% in market towns and -1.2% in coastal towns.

Footfall in Central London declined by -2.3%, less than half that in regional cities around the UK.

The latest Scottish Retail Sales monitor says that nation's retailers will be “fighting for survival and recovery” over the next few months as the challenges facing the sector show no signs of abating.

September was the eighth month in a row of declining retail sales in Scotland, with total sales last month down 6% compared with the same period a year earlier.