Independents are among those bucking the current retail trend, according to retail research analyst Michael Weedon, managing director of retail research company exp2.
Following a spate of dispiriting headlines about household name multiples closing stores, and others going into administration, he focused on the positives when addressing delegates at the recent GA Members’ Day and AGM. “Retail employs over 3 million people, and when there are headlines about big names on the high street going down, everyone naturally gets very nervous. However, House of Fraser for example, was burdened with debt yet went on cutting its prices.”
Using figures from the ONS and London Data Company (LDC), he highlighted that retail spend has actually grown significantly, and that shop vacancies have been improving, with the increased spend buoyant due to inflation and population growth. “Independent retailers saw their sales increase by 7.3% at £3bn, compared to the big companies who only saw a 2.2% rise.”
He also pointed out that although volumes are subdued, and shop numbers have fallen over the past year, town centres have retained the top share, while retail parks have added the most space. “Footfall is down by an average of 6%, but up in retail parks. Additionally, non-food retailers – to include gift independents – are doing 42% of the business, with 50.5% of shops still situated on the high street.”
Talking about gift shops specifically, he commented: “They come and go, but people still feel very confident about opening a new shop, with the average retail outlet in general staying open for around 10 years.”
Looking at the service and leisure centre retail sector, he says that they are replacing comparison goods – with retailers changing from selling things to becoming more service focused and doing things – with the top five retail services in 2017 revealed as barbers, beauty salons, vaping shops, cafes and nail salons. Conversely, the recent biggest net closures have been banks, pubs, travel agents, post offices and newsagents.
“However, bespoking and personalisation, in its many forms, is a key service, working both online and offline, with gifting and personalisation going hand in hand,” he continued.
While online sales are continuing to grow, he stressed that after nearly two decades, online still only accounts for £1 in every £6 spent. “84% is still spent in shops,” he underlined, “with people using the internet to research their purchases, but it’s worth remembering that not all purchases are made online.”
Concluding, Michael commented: “Even when you get short term problems – and we all know that it’s currently tough on the high street – there are still reasons to be a little bit positive, if not out and out optimistic!”
Michael, who works closely with the Federation of Small Businesses (FSB), is a former director of the British Independent Retailers Association (bira).
Top: Michael Weedon was the keynote speaker at the GA’s Members’ Day/AGM earlier this week.
