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Figures released from the Centre for Retail Research have shown that almost 50 shops are closing a day, however the larger stores are now starting to also exit, including Paperchase, House of Fraser, New Look and TK Maxx.
According to Andrew Goodacre, CEO of the British Independent Retail Association (BIRA), “The recent announcements of store closures by large retailers and hospitality businesses is further indication that the high street is a fragile place for businesses at the moment.
“Low footfall, train strikes, cost-of-living are all impacting on the high streets, especially in the large city centres and shopping centres. It is not unusual for large businesses to review their estate, close down unprofitable sites and focus on the remaining shops.
“However, for the smaller independent, who most only own the one shop, these difficult economic conditions may mean the end of the business and that business owner’s livelihood,” he said.
The impact on indies
Big retailers are usually the pull for consumers hitting the high street, and it is often once these shoppers are already in town that they stumble across independents. In this way, their disappearance could negatively impact small businesses.
As a spokesperson for the British Retail Consortium (BRC), explained, “Large retailers can play a crucial role as anchor stores in town and city centres, attracting customers to the high street and benefitting surrounding shops and cafes.
“As retailers face mounting supply chain cost pressures, and as consumer demand falls owing to the cost-of-living squeeze, retail businesses will continually assess the location of their stores, taking into account changing demographics, transport links, and consumer footfall.”
Tina McKenzie, policy chair at the Federation of Small Businesses (FSB), agreed, “The healthiest high streets are the ones with a mix of businesses small and large, as well as other amenities and attractions.
“The presence of a big-name ‘anchor store’ can act as a pull factor for shoppers, of course, with independent retailers nearby often benefiting from higher footfall, and the reduction of larger retailers’ footprint can lead to concerns.”
Emma Jones, founder of Enterprise Nation, added, “The trend for retail chains to shrink and evolve their geographical spread is nothing new, but the reality is for the small businesses left behind, empty spaces left dormant do nothing for footfall.
“They do however, reiterate the fact that consumers are looking for something new and fresh – and that’s often provided by smaller, independent retailers, pop-up shops, co-working spaces that bring small businesses to the high street, and experiential events that offer a different experience every time.
“It’s very clear we need to rethink the way high streets are planned by local authorities and that we must be prepared to use spaces more innovatively and creatively. The trend towards more home working post-pandemic has brought people back to their communities.”
With the chancellor’s Spring Budget announcement coming soon, the next few weeks will be crucial for independent businesses on the high street.
As Andrew explained, “These closures, and the report of record closures last year, should compel the chancellor to use the Spring statement in March to focus on economic growth, especially in the high streets around the UK.
“The inflationary pressures were never driven by consumer demand and are now falling away. This will give the government more flexibility to support independent businesses that play such a vital part in local communities.”
For Tina, “Councils and local businesses have a shared interest in keeping high streets vibrant, and there are many measures which can help, from better public transport and cycling facilities and free parking, to events and festivals, and a push to promote anything which is a source of civic pride.
“The Government could give high streets in England a huge boost by extending the threshold for full Small Business Rate Relief to £25,000, from its current level of £12,000. This would give immediate relief to hundreds of thousands of small businesses, many of them in levelling-up target areas. It would also remove a significant barrier for would-be entrepreneurs with a bright idea that needs premises to work, taking away a day-one cost that is a disincentive to start-ups.
“We’d also like to see VAT-free shopping for overseas visitors reinstated, to give a helping hand to small shops who benefit from tourists.”
According to Emma, 96% of the UK’s businesses are diverse, small micro businesses and start-ups. But within government, the representation for this group is extremely disproportionate.
She told Speciality Food, “We’d like to see this group represented at the highest level in government at regular meetings in the same way that the government engages with organisations that represent larger businesses.
“We’d also like to see measures that would make it easier for smaller brands to use high street spaces more flexibly. That might involve supporting landlords to embrace new trends like shared flexible spaces more enthusiastically and this in turn could bring about the innovation we need to see and help local business to bloom.”