Penrith, like many towns across the UK, is facing a pivotal moment. A new report has revealed stark warnings about the future of Britain's high streets, with small businesses under increasing pressure from soaring costs, falling footfall and shifting consumer habits.
According to the Simply Business 2025 SME Insights Report, 63% of small businesses believe the high street as we know it will be obsolete within the next ten years. Based on a survey of over 2,000 small business owners, the report sheds light on the immense challenges facing the UK’s high street economy – challenges that are being felt locally in Penrith too.
Among the most pressing issues reported were the rising costs of running a business (52%), reduced consumer spending (29%) and a significant decline in footfall. Notably, 37% of high street shop owners said they plan to close or sell their business in 2025.
"High streets everywhere are experiencing pressure, from changing consumer habits to rising operational costs," the report states. "Penrith has unfortunately seen a number of small independent and national businesses vanish from the town over the last few years. The significant decline in tourists coming to Cumbria that have traditionally driven footfall in Penrith and across the region since the pandemic is now having a clear impact."
Despite the thousands of new homes built in Penrith in recent years, the traditional “keep it local” loyalty is in sharp decline, with more shoppers opting to buy online or travel to larger shopping destinations.
Some of the key barriers identified by small businesses include high business rates, National Insurance contributions, and unpredictable operational expenses. One local business owner explained:
“Rising costs have definitely affected our business – particularly energy costs. One month we were paying £250, the next it was £1,300, then £1,200. It was all over the place. When you have a business where you’re not making that much profit, when things go up, it can make things a lot tighter. One way the government could help me, and other small businesses right now, would be easier access to funding.”
Julie Fisher, UK CEO of Simply Business, said:
“The UK’s high streets are an important part of British culture. These vital hubs provide essential services and are crucial for the UK economy – but high street businesses have made clear the stark reality.
“Our annual SME Insights Report has revealed almost three quarters (74%) have seen customer numbers decline. And in a worrying look to the future, 63% think the UK high street has just 10 years left before it becomes obsolete.
“Seeing so many SMEs across the UK struggling is a serious cause for concern, not just for the founders of these businesses but for the British economy and our wider communities. SMEs provide over £2.8 trillion in annual turnover, and account for over half (60%) of private sector employment. Our high street businesses play a key part in these figures.
“From reduced business rates to initiatives that increase footfall, we encourage the government to acknowledge the fears of Britain’s inspiring entrepreneurs and hear their calls for support.”
When asked what would make them more likely to visit their local high street, 61% of consumers said they wanted to see more independent businesses and fewer chains, 58% asked for free or affordable parking, and 50% wanted a wider variety of activities available.
In Penrith, efforts are already underway to face the challenges head-on. Evolve Penrith, the community-led initiative developing a long-term Neighbourhood Development Plan for the town centre, is urging residents, businesses and local authorities to think boldly about Penrith’s future.
A spokesperson for Evolve Penrith said:
“Penrith has traditionally jumped on a bandwagon at the end of a trend rather than setting the trend. The planned Business Hub the council is proposing to spend millions on is a prime example – many other areas had these over a decade ago, and now usage is declining, as seen in the council-owned business hub in Kendal.
“It’s time to take a long hard look at the town and be ahead of the curve and start planning and reimagining Penrith now to secure its future. It’s not about spending thousands of pounds sticking a few new signs up around Penrith and hoping it brings in an increase in footfall like the town council are currently planning to do.”
“We need everyone to work together to explore and implement creative strategies to support the town, including continuously developing initiatives to increase footfall and spend within the town centre we have now but also accepting the need for change. This is not anyone’s fault, but it is up to everyone to be part of the solution and part of planning for the future – what Penrith 2035 will look like.
“While we’re not immune to the wider economic landscape, Penrith is well placed to evolve and take advantage of the assets at hand – from the transport links and the area’s natural landscape to opportunities beyond the traditional tourism and agriculture-focused economy, including new emerging sectors.”
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