The Retail Crisis

Has been brewing for many years and should come as no surprise to retailers, local authorities, property companies and central government – all of which are now wailing and gnashing their teeth.

Apart from food shopping I seldom go into shops. I was an early internet shopper, have advised retailers on ecommerce and live in Macclesfield, a town that exemplifies the problems that many smaller towns face.

The are 1000+ towns in the UK and 500+ are probably “in trouble”. At one end of the spectrum wealthy town like Winchester (my home town) will not be hit too badly. At the other end Burslem (Potteries) has virtually ceased to exist.

So, who is to blame and what needs to be done to address the problem?

Retailers – It isn’t fair to lump all retailers together. Many of the big chains have done an appalling job with their ecommerce – at least marksandspencer.com now admit it and their previous management must take responsibility. Too many others are still woeful and “Omnichannel” is NOT the answer. Other retailers just provide a very poor shopping experience e.g. WH Smith.

Smaller retailers cannot invest in good ecommerce and have to rely on an attractive shopping environment and merchandise that cannot be bought online more cheaply – otherwise people will try-on and then buy online. Motor dealers have suffered from “tyre kickers” (people who take a test drive and then source online) for years. It is almost human nature.

Many retailers – clothing, footwear will struggle. Furniture retailers need large premises – so will be out-of-town. Ditto most supermarkets – in-town being the place where artisan and leisure businesses will thrive. Old established local shops that own their own premises will survive – temporarily.

Much retail is ephemeral, the nail bars, hairdressers, sandwich bars, cafes etc. Some survive and prosper.

Local authorities – must take most of the blame. My own, Cheshire East is truly appalling – dead from the neck-up. For 10 years they tried to foist a scheme centred around a new Debenhams on Macclesfield, until Debenhams pulled-out. Then they tried one centred on a cinema until that developer pulled-out. Cheshire East are in denial.

Macclesfield has acres of derelict land surrounding the town centre and the council has been tardy in turning this into much needed affordable housing, (even though they have the powers (s.215) ). The same is true for many towns in the north – Stoke has a massive amount of brownfield land and derelict sites.

Property companies – have a real problem because they have revalued their portfolios upwards to unrealistic levels. They then complain when retailers enter CVAs. The big institutional investors are also part of the solution.

Owners who deliberately allow buildings to degenerate (removing ridge tiles, a suspicious fire) should be punished. The one in the picture is (I believe) owned by a bank.

Central government has been too slow to address the problem of declining town centres. it was pointed-out to them many years ago – Bill Grimsey wrote an excellent book that was largely ignored in favour of the “Portas” approach (which achieved nothing).

One retailer told me that their rates had multiplied by 3. Totally eliminating them isn’t the answer but this government has ignored the problem – the decline is a consequence of central government inaction, so MPs wringing their hands get no sympathy.

The solution. There is no “one size fits all”. Macclesfield’s problems stem from the fact it is well-connected 20 minutes from Manchester and massive out-of-town developments on the A34. It was delusional of the council to think that Macclesfield could become a “shopping destination”.

One problem we have across the whole of the UK is a shortage of affordable housing. Many town centres can be revived and turned into attractive places to live for some segments of the population.

This needs direction and tough action by local councils is required to turn semi-derelict properties into housing. Funding from central government and institutional investors is desirable. Central government doesn’t like making tough decisions. Cancel HS2 and divert the money to improving towns in the north (the illusory beneficiaries of HS2).

More people living in town centres (especially young people who need affordable housing) means these towns will have a better chance of surviving. Town centres also have good transport links – rail and bus stations tend to be located there. They can also be made attractive to older people  with social centres and heath centres. Food markets and green spaces make them attractive to all – and they need to be traffic free, with free residents parking.

The solution is not rocket science, it just requires an understanding of how the world is changing. Just as understanding that technology is bringing about changes to working patterns; the advent of autonomous vehicles and mobility-as-a-service are the reasons why HS2 is not required. Dump HS2 and use some of the money to revitalise towns.

 

One comment

  1. suemason · · Reply

    Excellent summary and photo.
    Cheshire East has responsibility for blighting the town with its ridiculous Wilson Bowden Scheme – how much did that cost?
    Prior to that was the routing of by pass that cuts the town in half ( Churchill Way) and car parking fees. Drivers go to Handforth Dean and John Lewis. And what was Lyme Green all about?
    The town is a depressing place.

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