Why are so many retail stores closing?

It’s been a domino effect of stores closing and in Canberra where I live, there’s been a big change to the landscape of the main shopping centre, The Canberra Centre.

Cos and Tommy Hilfiger have gone. Zara closed a few days after announcing it was shutting shop. Fine Day is also no more and the rumours persist about other stores closing too.

It’s not all bad news with Kookai opening soon (although there have been mixed reactions over the size range), LSKD is here, Style Runner recently opened and then there’s the massive Mecca concept store coming too. Chanel beauty is opening later this year as well.

The most recent announcements of additions to The Canberra Centre are high end stores Rebecca Vallance and Scanlan Theodore.

A quick look at Rebecca Vallance – which has stunning designer dresses – and the cheapest dress is $449 while the most expensive is $1,299. You can find some gorgeous dresses on sale though and the sizes range from 4 to 16 or 18.

Over at Scanlan Theodore, the cheapest is a $160 sweater and the most expensive is a $3,000 leather coat. This brand starts at a size 6 and ends at a 12.

With stores closing because of a cost-of-living crisis, I wonder about these high-end stores opening. I also wonder whether more stores will close. Is there a future for bricks and mortar stores or are we shopping so much online, they’ll continue to close? So, I went to an expert.

Chief executive of the Canberra Business Chamber Greg Harford says retail spending is down in the ACT, making it a tough economic environment.

“High interest rates are putting real pressure on household budgets and although the RBA has now started to move rates down, households have been squeezed significantly over the last couple of years,” he says.

“At the same time, we are continuing to see a trend to customers shopping online and having their goods delivered, which makes it harder to sustain the viability of physical retail, particularly in a relatively small market like the ACT.”

In more positive news, Greg Harford says there’s still a strong future for retail stores.

“Shopping is a big social activity, and Australians are still wanting to be able to get out and about with their friends, explore stores and have fun,” he says.

“This means we are likely to see a continued evolution of Canberra’s retail spaces, with an increased focus on services and great experiences.”

And the General Manager of The Canberra Centre is upbeat saying there’s growing confidence in Canberra’s retail industry, proven by big name brands opening.

“We are committed to creating a unique retail experience and continuing to support the local community by bringing leading brands to the heart of the capital.” 

If you’ve walked through the Canberra Centre, you’ll see upgrades and changes throughout to make way for these new stores and more apparently.

That evolution will be so interesting! I guess we watch this space but, if you can, get out and support stores to ensure they stay open.