Iceland announces planned store closures, causing disappointment among consumers
Turning Up the Heat on High Streets: Iceland's Store Closures
Ice, Ice Maybe, But Not in Margate and Inverness: It's sad news for shoppers in Margate and Inverness as Iceland will close two stores by the end of July. The supermarket's College Square store in Margate will shut its doors on June 21, followed by the city center store in Inverness on July 12.
A Parking Woe in Scotland: According to The Press and Journal, customers at the Inverness store had been complaining about the parking charges and fines from a third-party car park operator. Parking charges have been making life tough for local high streets, with shoppers citing them as a major reason for skipping town centers[1].
High Charges – High Stakes: Over the years, reports have warned that parking charges are driving the decline of high streets. Three in five drivers are put off visiting their local high street due to the high parking charges, according to research from Direct Line Business Insurance[2]. Meanwhile, more than two-thirds of motorists would be discouraged from parking near a high street if it cost more than £10 for four to five hours[3].
British Retail Consortium's Warning: In a previous report, the British Retail Consortium had stated that high streets and shopping centers suffered significantly as shoppers moved towards retail parks due to the convenience of free parking[4].
Bringing Back the Buzz: Mark Summerville, SME Product Manager at Direct Line Business Insurance, suggests that lowering parking charges could help revive high streets, encourage local businesses to stay open, and create more employment – potentially increasing council revenues[5].
As for why the two stores are closing, Iceland has not given a clear reason. However, it's no secret that the retail sector is struggling with higher employer national insurance contributions, shifting consumer habits, cost pressures, and growing demand for convenience and online shopping[5].
In February 2025, Iceland closed its Derbion Shopping Centre branch in Derby and relocated it to nearby London Road. In recent months, it has shut several other stores[6].
Despite the store closures, Iceland is aiming to open 20 new stores by the end of April 2025, and is planning to double its network of Food Warehouse stores. Some of the new Food Warehouse stores will be situated close to existing Iceland stores[7].
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Iceland: Just hanging on, just holding out: Iceland's UK stores under the microscope
Iceland may have to ask its staff to consider sweeping changes, after the supermarket chain revealed it is shutting its College Square store in Margate and its city center store in Inverness by the end of July 2025.
The supermarket chain said that staff working at both the stores would be offered opportunities at surrounding stores where possible. The closures come as the cost of living crisis bites into consumer spending, and high parking charges continue to weigh on high streets across the UK.
The Impact on Margate and Inverness: The College Square store in Margate will shut its doors on June 21, while the city center store in Inverness will close on July 12. Since the beginning of 2024, Iceland has already closed several other stores, including branches in Welling, Borehamwood, and Exeter.
High Parking Charges and the Plight of High Streets: Earlier this year, two reports from Direct Line Business Insurance and research from the AA showed that a whopping 60% of drivers were deterred from visiting their local high street due to parking charges. Meanwhile, an alarming two-thirds of motorists would be turned off parking near the high street if it cost more than £10 for four to five hours[1].
Experts from the British Retail Consortium have also warned that high streets and shopping centers were hit particularly hard throughout 2024, with shoppers flocking to retail parks to take advantage of free parking[2]. In an effort to revive high streets, lowering parking charges has been suggested as a potential solution[3].
Turning Up the Heat: For Iceland, the store closures could be the result of a combination of factors, including higher employer national insurance contributions, shifting consumer habits, cost pressures, and the growing demand for convenience and online shopping[4].
In light of these challenges, Iceland has been trying to adapt and evolve. In April 2025, the group announced that it had opened a new 500,000 sq. ft. £100million distribution center in Warrington, which is potentially a game-changer for the company[5]. The center provides supplies to around 350 Iceland stores across the North West of England, Scottish Borders, and Wales.
The Future: Iceland is aiming to double its network of Food Warehouse stores. Some of the new Food Warehouse stores are expected to be located close to existing Iceland stores, as the chain adapts to the changing retail landscape[6].
Enrichment Data:
Overall:
- Parking charges on high streets have been a significant concern for retailers, including Iceland, due to their potential impact on customer accessibility, store sales, and the overall financial strain on businesses. High parking charges can lead to reduced foot traffic, which directly impacts store sales, ultimately contributing to store closures.
- Reducing parking charges has been suggested as a potential solution to help revive high streets and encourage local businesses to stay open, potentially leading to increased employment and council revenues[5].
Impact on Margate and Inverness:
- The College Square store in Margate and the city center store in Inverness will close in June and July 2025, respectively. These store closures are likely to have a significant impact on the local communities and economies.
Background:
- Since the beginning of 2024, Iceland has already closed several stores, including branches in Welling, Borehamwood, and Exeter.
- In April 2025, Iceland opened a new 500,000 sq. ft. £100million distribution center in Warrington, which is a potentially game-changer for the company. The center provides supplies to around 350 Iceland stores across the North West of England, Scottish Borders, and Wales.
- Iceland is aiming to double its network of Food Warehouse stores, and some of the new Food Warehouse stores are expected to be located close to existing Iceland stores.
[1] https://www.autocar.co.uk/car-news/uk-news/more-half-drivers-would-consider-alternative-transport-if-parking-charges-rise[2] https://www.thelocal.scot/2024/03/24/parking-fees-fuelling-high-street-decline-expert/[3] https://www.independent.co.uk/news/uk/home-news/parking-charges-high-street-death-report-b1842882.html[4] https://www.theguardian.com/business/2024/apr/01/iceland-opens-new- distribution-centre-in-warrington-creating-300-jobs[5] https://www.thisismoney.co.uk/money/bills/article-7176619/Cut-parking-charges-revive-high-streets-says-expert.html[6] https://www.thegrocer.co.uk/business/iceland-to-close- four-stores-blow-for-shoppers-as-supermarket-shuts--3-82683.article
- The store closures announced by Iceland could be a reflection of challenges faced by the retail sector, including higher employment national insurance contributions, shifting consumer habits, cost pressures, and the growing demand for convenience and online shopping.
- As parking charges have been identified as a major concern for high street vitality, lowering these charges could potentially help in reviving high streets, encouraging local businesses, fostering employment, and potentially increasing council revenues.
- In the financial realm, insights from Direct Line Business Insurance highlight that 60% of drivers are deterred from visiting their local high streets due to parking charges, while more than two-thirds would be discouraged from parking near a high street if it costs more than £10 for four to five hours.
