What: A comprehensive state of the UK department store business.

Why it is important:  More innovative services, online presence and new store formats, less legacy stores: the UK market is quickly evolving.

In the wake of Brexit and Covid-19 pandemic, the UK retail scene has significantly changed. Coresight reviews the performances of the major players (Debenhams, Harrods, House of Fraser, John Lewis, M&S and Selfridges). Even though the department store market has undergone a permanent decrease over the past 5 years (-7.1% CAGR), Coresight envisions that 2021 will show an overall growth of +5.4%.

The main features of the market are:

• A gap between luxury department stores, which have consistently thrived over the past year, and mass department stores which are suffering,
• A significant consolidation: the top 6 department stores account for 95.3% of the total market (John Lewis 35.7%, M&S 21.5% and Debenhams held 13.9% market share in 2020 before liquidation),
• Massive store closures (112 stores closed between 2015 and 2020),
• A innovative mindset with new services offered to customers.

Coresight reviews each player one by one, including their e-commerce activities and future. It considers that the Debenhams store closures create a new opportunity for other retailers to capture market share, provided they are able to follow a new approach regarding stores, from legacy stores to showroom and small-format ones.

UK Department Stores Change Provides Opportunities