According to a recent report by international real estate advisor Savills highlighting the sectors in the German retail market which are most resistant to the impacts of e-tailing, fashion retailers came out on top as the best performers, opening 59% of all new stores between 2007 and 2012.

The firm’s research looked at the retail occupancy structure of the 19 main shopping streets in the six biggest German cities, Berlin, Cologne, Dusseldorf, Frankfurt, Hamburg and Munich, and analysed relevant changes over the past five years to determine the effects of the growing trend towards e-commerce. Savills reports that in the period studied, fashion was the most resilient sector in Germany, with more new shops opening than closing. A quarter of those opened were by luxury brands, while almost half were chains and one third local independent retailers.

The findings highlighted furniture, mobile phone, cosmetics and leather goods as additional retail sectors resistant to the economic slow down and increasing competition from online sales, which has increased in these areas by 10% on average every year since 2006.

Savills research shows that amongst the sectors which have seen the largest net fall in high street shops in Germany, electrical and book retailers were the hardest hit. The company notes that there are now only two independent book shops remaining on the German high streets studied and online sales of e-books grew by 38% between 2007 and 2011. The report also shows that the electrical sector has seen diversion of sales to online with a 114% increase in e-sales. This sector has also seen a bias towards larger format out-of-town stores and therefore has had more closures on the high street.

Julia Maurer, European research analyst at Savills, comments: “What our research shows is whilst some sectors in Germany such as books and electronics have been strongly affected by the growth in e-tailing, other sectors are very resistant to its impact due to both practical issues such as wanting to try products before purchase, and the blurring of retail and leisure experiences.

“Looking to the future, online sales will continue to grow, but retailers will still be keen to trade from high street stores in order to maintain brand recognition and to satisfy the demand from customers for an in-store experience. We will therefore see a steady upward growth in rents in prime locations, in fact, despite the economic slowdown and competition from online sales, prime rents in Germany have increased by 13.4% on average over the past five years.”

The firm predicts that the rise of online shopping in Germany will mean that retailers need fewer stores to cover the whole country and will look to rationalise their portfolios as a result. This will lead to increasing polarisation between stronger and weaker trading locations with retailer demand expected to remain robust in prime locations, which will drive steady upward rental growth in these areas.

The impact of e-commerce on German high streets