The Retail Tsarina

Author: Jacqueline Button

As everyone (save, presumably, our increasing population of the functionally illiterate) knows Mary Portas, former Queen of Shops and current Secret Shopper, has been appointed by the government to carry out a review aimed at “halting the decline of the High Street”. There was a time, in another millennium, when people were appointed to this sort of role due to nepotism, cronyism, corruption or even because they had the right experience to carry out the task. Now, for this big, important role we get a TV personality.

Vacancy Filled

However, a high-profile, energetic, opinionated person is just what is needed for this Herculean job. The government (David Cameron, personally, no less) wants Ms Portas to look into the problems of empty shops and “clone towns” with a view of identifying what “government, local authorities and businesses can do to promote the development of more prosperous and diverse High Streets”.

Ms Portas began her new job with something of an own goal when it was discovered that she had a relationship with Westfield who are hardly champions of independent retailers. We have to look past that, however, and see what she can deliver. The problems with our high streets are big and getting bigger as more and more retailers (HMV, JJB, Thorntons to name but three) start closing stores. In some towns, particularly in Northern England, vacancy rates are alarmingly high and it is a self-perpetuating problem: once a few shops are empty other retailers either choose to move or are forced to close due to lack of passing trade.

Clone Wars

Clone towns are a different issue and appear a less serious one. Presumably even Ms Portas and the government agree that is better to have a high street full of big brands rather than half empty with a couple of struggling independents. But creating retail diversity is like any other kind of positive discrimination – rife with issues. The only way it is going to work is to get all the players to work together.

The first are the big brands themselves. Ms Portas has long been running a campaign to get the likes of Tesco to work alongside rather than against their local counterparts but appealing to the better nature of big business isn’t going to produce more than superficial results. Big retailers have shareholders to think of and their core customers to please. They may make a token gesture to help out locally but they aren’t going to do anything which would threaten their dominance. That’s not business. Or human nature.

There is a role for local councils on the planning front and also on parking charges. Car owners prefer to shop out of town where parking is free rather than on the high street where they have to pay to park. Haringey Council has just increased the cost of parking on Green Lanes from £2.80 per hour to a staggering £6. And this is hardly a wealthy area.

And what can landlords and the property industry do? Long leases, upwards only rent reviews and quarterly rental payments don’t suit small, new businesses. Monthly payments are now more common but rents are set by the market and many small retailers simply can’t afford prime spots. But a government interferes in the market at its peril. It cannot be fair to allow a smaller retailer to pay a lower rent per square foot than its multiple neighbour. This isn’t fair on landlords either, and many landlords are pension funds so lower rents mean smaller pensions.

Having said that, a landlord can obviously pick and choose its tenants if it can afford to do so. Marylebone High Street is often cited as an example of diversity (although in reality it is dominated by chain stores) but it is an unusual example of a street with only one landlord who can treat the street much like a shopping centre and create its own mix of tenants.

Buying Power

Most importantly, it is the consumer who has to be convinced by Ms Portas’s review. 21st century customers are busy juggling jobs and families and often they want to shop as quickly and conveniently as possible. This means buying as many goods as possible from the same shop or a series of shops in the same place, preferably with easy parking, at a time which suits them. It means buying things from familiar brands or on the internet.

But its not all about the multiples. Consumers have the power in retailing and they tend to exercise it intelligently – they know a good shop when they see it whether it’s a big brand or an independent. Lots of independents do well but ultimately any shop, big or small, will close if it doesn’t sell what people want to buy.

Ms Portas’s review shouldn’t lead to a restriction of consumer choice by making trading harder for any class of retailer, even the big ones. She may be the retail tsarina, but on the high street the customer is king.
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© SA LAW 2011
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