I’ve been contemplating all the hype about the demise of the high street and whether this is really the effects of BREXIT or just an avoidance tactic of what is really happening in the retail sector.
As a retailer in the 80’s and 90’s in largely independent shops and a few well known chains I appreciate the challenges retailers face. Now a business advisor to many in the retail sector it is clear that high street shops do face some hurdles:
Consumer fears: Fear of the unknown combined with media persistence of relentlessly covering the negative impact of brexit is encouraging consumers to hold tighter to their purse strings, feeding fear of future recession; inadvertently creating the very financial crisis they wish to avoid. Decreasing spend, combined with the rises in inflation and lower wages, are reducing consumers confidence in buying from high street shops.
Ecommerce: the rise of armchair consumerism is growing as the millenials increasingly utilise social media websites and apps to find a date, socialize, order food and purchase even larger items 24/7 all with a promised next day delivery. Increasingly the opportunity to compare and utilise budget sites such as Ebay, Shpock, Amazon and more are encouraging the younger (and indeed the elderly) generations to avoid the busy city centres, increased parking charges and surly customer service in preference to buying online
Experiences: Consumers are now preferring their leisure activities to be “experience-led” whether for an adrenaline rush, a music event, a comedy moment or food; unique opportunities and special moments are rewarded by customer loyalty rather than the purchasing of just “things.”
The effect on retailers should not be underestimated.
But is this all negativity necessary? Our society has seen change consistently in its history. The small independent retailers replaced in the 80’s by supersized superstores with mass produced items we all wanted, and so we ALL had.
Independent retailers suffered during the 80’s, 90’s and into the new century and only the truly unique and exclusive survived. How ironic that these retail giants are being replaced by an online consumer, reminiscent of those who moved from the independent to the superstore in the first place. But isn’t this excellent news for independent shops again? Consumers now want something more. Consumers want experiences, to be “loved” “valued” and given something more than a quick sale; purposefully choosing elite towns and cities to buy and experience something different. Only the retailers who embrace this will survive.
My advice is “Let’s stop blaming the demise of the high street on BREXIT but embrace a new way of trading again.”
Consumers ARE still buying it’s just their habits are changing.
Last month, wages outpaced inflation for the first time this year which will have a positive effect on U.K. growth, with projections on target for 2% growth this year. In Quarter 1 2018, the value of household spending in current prices increased by 3.3% on the same quarter in 2017. When comparing the volume measure of household spending in Quarter 1 2018 with the same quarter in 2017, it increased by 1.2%. (ONS Gareth Powell 29 June 2018)
If we look at the restaurant businesses for guidance we can see a change in consumer behaviour for healthier eating and experiential dining and an increased focus on food provenance and sustainability the retail sector needs to learn from this.
Local sourced, unique, handmade products from independent retailers who offer an experiential shopping environment hold the future.
But towns and cities need to help. High rents, long leases and poor management will not encourage independents to return.
A revision of traditional retail into one of pop-ups, shared spaces and shorter leases will ensure our high streets remain vibrant and give shop owners the ability to profit and improve our economy.
With changes in every industry it is an exciting time for innovators, entrepreneurs, retailers, manufacturers and designers through whom the UK can grow and prosper.
We have seen significant changes in business operations throughout our British history; from cottage industry where consumers bartered and artisans were celebrated, artists prospered and individualism grew came the mechanisation of the textile industry, in the late 18th century. Tasks previously done by hand were brought together in a single facility, and the factory was born – the industrial age, with emphasis on production. This progressed in the early 20th century, into the age of mass production; thus impacting on retailers and handmade products; retailers following with mass produced lines.
However, since the 80’s came a third revolution – digitalisation. ( I remember when our shop had it’s first computer it was a frightening investment.) With the technological age came a focus on electrical systems, enhanced travel, computerisation and the internet and our retail habits have naturally followed suit with many having an E-shop facility.
So what next? are we are in a new age? Are we returning to preindustrial Britain? And need we fear change or embrace it?
Change made us Great Britain. We are still Great Britain. Let us not forget that when faced with challenges we always find solutions and progressive ways of working.
We still have artisans, artists, innovators, entrepreneurs and need to find new ways of working in a digital age. Yes, the retail sector has to change but its advent will provide exciting times ahead.
Death of the high street – I doubt it? Change? Absolutely.