Tag: Highstreet

Good weather boosts June footfall, high street gets the best of it

highstreet South endRetail footfall in June was up 0.1 percent year-on-year, reversing the negative trend in May, which saw a 0.7 drop. Good weather seems to be the main factor, as high street footfall was up 1.4 percent while out of town footfall was up 0.6 percent.

However, according to the British Retail Consortium, footfall in shopping centres dropped three percent following a previous drop of 1.7 percent in May. Looking at the first half of the year, the trend is largely positive, as footfall fell 1.5 percent compared to 2.9 percent during the first six months of 2012.

Greater London did particularly well, with a 2.4 percent spike, followed by Wales with a 2.3 percent increase. Scotland and the West Midlands were up by 1.2 and 1.3 percent respectively. However, footfall in the East Midlands was down 1.9 percent.

“The improvement in the weather may well have contributed to this,” said BRC director general Helen Dickinson. “Our recent retail sales figures showed a strong performance from fashion and footwear and it is likely that shoppers took advantage of the start of the sunshine in June to visit their local high street and buy items for their summer wardrobes.”

However, Springboard pointed out that good performance of high streets also has a lot to do with the fact that they underwent a bigger decline in footfall in previous year, which means they are starting from a lower base.

High Streets do better than malls

highstreet South endAccording to figures released by the British Retail Consortium (BRC) and Springboard, footfall in UK shops fell by 0.7 percent in May, year on year. Shopping centres saw the biggest decline, with a 1.7 percent drop, but there is some good news to report as well.

Retailers in London and Scotland outperformed the rest of the country, with footfall going up by 2.6 percent and 3 percent respectively.

The BRC reckons the good showing in Scotland can be attributed to good weather last month and the fact that sales were down over the first four months of the year. However, some regions weren’t as lucky. Footfall in Wales was 1.1 percent lower than a year ago, Northern Ireland saw a 3.1 percent slump, while the West Midlands and East Midlands were down 2.9 and 2.6 percent respectively.

Helen Dickinson, director general of the BRC, pointed out that conversion rates were relatively good. Although people made fewer shopping trips, they were willing to pounce on good deals and seasonal promotions.

In addition, high streets outperformed shopping centres in the first five months of the year. Although the high street saw a one percent drop, shopping centres were down 1.7 percent.

“Footfall across all retail locations in the past few months has definitely been proving to be very volatile, particularly in high streets, which fell by seven percent in March, rising by 3.4 percent in April and declining by one percent in May,” said Diane Wehrle, retail insights director at Springboard.

Larger regional cities saw the biggest improvements in footfall, but small towns didn’t fare well. Shoppers are still willing to drive to bigger cities and out of town shopping centres, in spite of good weather. Footfall in out of town locations was up 1.2 percent compared to a year ago.

High Street headed to gambling “ghetto”

highstreetBetting shops and payday lenders could rule the high street roost if new legislation comes into place.

The warnings from the Local Government Association (LGA) as new rules, which came into place yesterday, stipulate that some premises don’t have to apply for permission to change what they supply for up to two years.

It means that premises previously used as independent gift shops could be turned into payday loan companies while greengrocers could become betting shops, without the need for planning permission or public consultation.

The government said it had made the decision as it felt it would help boost economic growth and bring boarded-up shops back into use. However the LGA said that it felt it would do the opposite and instead lead to more high streets being over-run with clusters of betting shops and payday loan companies.

The association also pointed out that the new rules would  also allow almost any buildings to be temporarily turned into new free schools with no public consultation or planning permission. And in many parts of the country, developers will be given free rein to convert offices into flats without planning consent.

It said that the government had to rethink its plans and instead look at rejuvenating the highstreet by encouraging the opening of businesses that residents wanted there. It said the new rules would make this method harder.

Cllr Mike Jones, Chairman of the LGA’s Environment and Housing Board, said people were “fed up” of having their local high streets filled with betting shops and payday loan companies. He warned that was a “very real danger that, in chasing a short-term boost, this panic measure could end up creating real problems” in highstreets and doing lasting damage to our town and cities.

“This could potentially drain the life from our highstreets,” he said in a report.

High street apocalypse on its way

highstreetThe UK is “facing a crisis,” when it comes to highstreet shopping, a retail group has warned.

According to the Centre of Retail Research, one in five of Britain’s high street shops could close by 2018 as more customers turn to the internet for their shopping. The analyst company warned that, as a result, around 62,000 shops could close in the next five years – putting around 316,000 jobs on the line.

A further 164 major or medium-sized companies were also predicted to go into administration, involving the loss of 22,600 stores and 140,000 employees.

“Many of these companies will survive but at the cost of closing more than half their stores,” the company said.

Retail Futures 2018 forecasts found that consumers were shunning the high street with the share of consumer spending declining from 50 percent in 2000 to a predicted 40.2 percent next year.   As fewer shop in stores, online retail is set to account for 21.5 percent of total retail sales by 2018, from 12.7 percent today, the highest online retail share in the world.

It also pointed out with such a high number of transactions carried out online, retailers with a strong web offering now need just 70 high street stores to create a national presence compared to 250 in the mid 2000’s.

Wales and the North West are predicted to see the highest number of closures, with nearly one in three expected to fold, while the South East is expected to see a 13 percent decrease in the number of shops by 2018.

Policy Exchange calls for freeze of high street biz rates

gosborneCampaigners are continuing to put pressure on the Government to freeze business rates.

Think-tank, Policy Exchange, has become the latest organisation to call for the measures in a bid to save the high street and keep shops open, urging heads of the country to put in place a two year freeze on business rates.

It hopes that this will encourage retailers to keep shops open and help smaller companies afford their rents as well help them deal with competition from online stores who can offer cheaper prices as a result of no store fronts.

Yesterday the BRC published its latest figures, which showed empty stores remained a problem with the national town centre vacancy rate in the UK standing at 11.9 in April, up from 10.9 percent in January 2013 and marking the highest rate since the BRC survey began in July 2011.

A separate report by the Local Data Company (LDC) found that the percentage of empty shops in the country’s 650 most popular high streets nationally hit 14.2 percent – roughly 35,500 vacant properties – in December.

Policy Exchanges’ calls come months after the BRC threw down the gauntlet to George Osborne, urging him to use the budget to save the flagging high street.

Ahead of the Chancellors’ Budget speech in March, the organisation urged him to intervene to support jobs and growth by freezing business rates as well as cut  utility bills to help businesses stay on premises.

* Oxford’s famous Covered Market is threatened by huge rises in rates. There is a petition to save it, here.

April brings ray of sunshine to high street

highstreet South endApril brought a ray of sunshine to the high street with footfall improving.

According to the BRC, high streets reported a rise of 3.4 percent, the strongest performance since December 2011, followed by out-of-town, which grew by 0.3 percent.

However the better weather didn’t warm everyone with footfall in shopping centres falling by  three percent in April, its worst performance since January 2013.

And empty stores remained a problem with the national town centre vacancy rate in the UK standing at 11.9 in April, up from 10.9 percent in January 2013 and marking the highest rate since the BRC survey began in July 2011.

Helen Dickinson, British Retail Consortium Director General, said it was a “major concern” that the vacancy rate has reached a record high, driven by increases in almost every part of the UK, with some regions like the South West seeing a significant leap in empty shop numbers.

She added that with high streets topping the agenda for many there was a real opportunity “to seize the moment and stem the tide of further closures”.

“Comparatively small steps to tackle deep-rooted issues such as parking, accessibility and rising business costs could make a huge difference to the health of town centres,” she added.

Diane Wehrle, Retail Insights Director at Springboard, added the improved weather made a “significant difference” to footfall performance across the UK in April, with an improvement from -5.2 percent year-on-year in March to 1.0 percent in April.

Light fingered employees put strain on high street

highInside job thefts in highstreet stores are continuing to rise as light fingered staff see selling knock-off products as additional income.

However, one manager of a high street store has warned prices will continue to rise to cover the loss in sales as well as rise in security and insurance premiums.

High street clothing sales have faced a hard start to this year thanks to bad weather and the economic climate preventing people from splashing out on new clobber.

However, it seems luxury brands and the tech retail industry are facing more trouble from staff who believe they can earn an extra bob or two.

In its 2012 Retail Crime survey, the British Retail Consortium said the cost of crime had risen significantly by 15.6 percent, to an overall cost of £1.6 billion.

It said employee theft accounted for four percent of retail crime by cost, although just one percent of the number of incidents. However it pointed out there were 10.2 incidents of employee theft per 1,000 employees, almost double the rate of the previous year.

The average cost per incident also rose sharply at more than four times the previous year’s level. The average cost per incident of employee theft reached £1,577,  riven by a larger number of high value thefts compared with recent years. The BRC pointed out that this was the highest level of average theft recorded for at least eight years.

“There has been more items going missing from our store rooms,” a manager for a high-end retailer told ChannelEye.

“It seems no-one is happy to have a job anymore. I think the rise is probably more obvious in the luxury brands sector with people wishing to buy items from designer stores but without the cash.

“By buying knock-off gear they are saving themselves money but what they don’t realise is that we’re also having to push prices up to compensate for this. It’s a vicious circle.”

Another manager for a fashion retailer blamed the lack of wages for the rise in crime.

“We’ve seen more thefts but we’ve not caught anyone out. It’s just things missing in our inventory. We still carry out the usual bag check at the end of the day and before breaks but it’s inevitable things are going to be swiped,” she told ChannelEye.

“Products are getting more expensive and our staff are coming in on minimum wage. Some see the opportunity to sell things on and get more money as a good thing. There’s no loyalty anymore.”

And it seems the tech industry is also faring badly. “With the economy the way it is we’ve seen thefts, most of which could have only been performed from inside,” one assistant at a high street tech company told ChannelEye.

“Gadgets make good money and at times it doesn’t suit us to claim on insurance for it. We’re tightening up our CCTV in warehouses now as well as bag checking a lot more.”

Hilco to cut another 400 jobs at HMV

hmv-administrationHilco, the new owner of HMV, is planning to cut 400 jobs at the troubled entertainment retailer. The Times reports that Hilco is looking to save as much as £7.8 million from its annual payroll and the latest round of cuts is just one in a series of cost cutting measures.

An internal memo to HMV staff listed the positions earmarked for layoffs. Although Hilco did not say exactly how many jobs will be cut, the memo states that three positions in most of HMV’s remaining 141 stores will go, which amounts to about 400.

Security guards will be among those dropped in nearly all stores, except those in “high risk” areas. Cashiers in more than 100 stores will also lose their jobs, along with supervisors. It seems that part-time staff will eventually account for about 50 percent of HMV’s total workforce.

Hilco scooped up HMV earlier this year and it apparently plans to focus its revival efforts on 141 stores, employing around 2,500 souls. However, the future of dozens of stores across the country has already been sealed.

Marks and Spencer sees decline in fashion

marksandspencerExpensive celebrity fueled adverts have lost their magic with Marks and Spencer reporting a fall in clothing sales.

The company has struggled with its clothing sales over the past few year.

However, it enjoyed a brief success after a range of initiatives. This included
hiring celebrities such as Myleene Klass, Dannii Minogue, Lulu and Gary Barlow to promote the brand, as well as targeting younger consumers.

Despite its latest figures rising slightly in the first three months of 2013, the company pointed out that the profit was gained through its food business, which offset a fall in clothing sales.

UK food sales hit a four percent growth compared to the same time last year, however clothing and merchandising was down by 3.8 percent.

M&S chief executive Mark Bolland said the company was “working hard” to improve its performance on general merchandise, blaming “difficult trading conditions.”

The company said its food division had been outstanding, with Easter food sales their best ever. The figures matched recent research by the British Retail Consortium, which in its latest highstreet tracker said Easter sales had helped revenue rise.

And it isn’t isolated in failing to make a profit on clothing with the highstreet in general suffering as a result of prolonged bad weather and the economic climate.

According to Clive Longbottom an analyst at Quocirca, there are a few things the chain could do to improve its flagging fashion figures.

“I think that M&S has started to slide back to the things it was doing wrong before,” he said. “It has a massive range of clothes, far too many for the sort of clientele it has”.

“Therefore, it has to carry a lot of inventory, and I expect that a lot of this has to be disposed of through sales or through cutting the labels out and selling off to others at cost or below,” Longbottom said.

He gave an example of a personal trip to a store , which he said was “laid out badly”.

“We were there to find a dress for my mother-in-law, a woman in her late 80s.  If she had been with us, I doubt that M&S would have made a sale at all, the clothing was laid out in completely different areas with no commonality or means of identifying where we should go,” he said.

“Better structure to how M&S lays out its goods may well help in ensuring that its mainstay audience can shop by category, rather than having different “makes” of clothing bunched together when all of them are M&S anyway.”

However, he praised the company’s underwear department, which he said kept everything in in one place and it is easy to compare and contrast and said Marks and Spencer should extend this to other parts of its store.

“Try to compare and contrast a skirt and blouse – you’ll need to pick things up and carry them around the whole store so that the three that you want to compare and contrast are in the same place at the same time – and then you have to dump the two that you don’t want, as it will be impossible to remember where they came from in the first place – so causing cost for staff to put things back where they came from,” he said.

“I’d advise cutting back on the number of styles M&S stocks; grouping by type of clothing, like skirts, dresses, blouses, etc, and having more staff on the floor to provide sales help to shoppers. On the whole, the M&S people we saw were generally behind the sales desks.”

Labour wades into high street debate

highstreetLabour has put its oar into the “how to fix the high street debate”.

Ed Miliband, Labour leader,  said that he wants to see payday lenders and betting shops that “engulf” people in debt, as well as take-away food chains, banned from the high street.

The Labour leader is speaking out against the way these shops are allowed to open up at the drop of a hat – sometimes next to each other – at the launch of his party’s local election campaign.

He proposes changes to planning laws, allowing councils to refuse permission for certain businesses.

He is expected to say councils should be allowed to prevent shops opening, such as payday lenders and bookmakers, which do not have a community’s backing as he believes in “local solutions to local problems”.

Miliband says that too many councils are finding that they don’t have the real power to stand up for local people. He said that if a bank or store closed down there is currently nothing that can be done to prevent a payday lender or betting shop opening up.

Last year 1,800 leisure, retail and services shops closed in England. Many were replaced by pay day loan shops, which saw a 20 percent increase in openings.

Tourists bounce through UK stores over Easter

highstreet South endTourists from across the pond helped boost Easter trading figures in blighty, research has found.

According to the latest figures, tourists flocked to UK stores in a bid to find British gifts for their pals back home, pushing up footfall and finances.

The New West End company, which represents 600 retailers on Bond Street and Oxford Street in London, told the Express that it had seen more feet through doors with a 2.3 percent rise on Good Friday and Easter Saturday compared to last year.

It said people, including those from the US, France and Germany  made the most of exchange rates and splashed around £75 million over the two days, a huge jump of £15 million more than 2012.

And it wasn’t just London which had financial success with coastal towns also raking in the cash over the Easter period.

Consumer environment to remain subdued says Next chief

highstreetNext’s chief exec has warned that the consumer environment will “remain subdued”.

Lord Wolfson’s comments come as the retail giant, which has 541 stores nationwide, posted its financial figures for  the second quarter of 2013 where it announced a nine percent rise in profits.

Figures jumped to £621.6 million and revenues from its online business increased by 9.5 percent to £1.2 billion.

However, despite hoping to increase profits to £665 million this year, Lord Wolfson said the economy was still difficult and it would take time for the nation to work its way back to “affording the lifestyle it was already enjoying before the financial crisis”.

The Chief’s comments contrast to a recent report by the Office of National Statistics (ONS), which found that retail takings grew by 1.8 percent in February after a slow start to 2013, which was blamed on the bad weather.

Department stores  saw a 10.6 percent sales increase in February – the biggest monthly rise since last April driven by computer equipment and jewellery.

However, Next has yet to see the benefits with Wolfson claiming the company’s earnings were running below the rate of inflation. He said this decline in real earnings looked set to continue for at least one, if not several more years.

“Indeed the outlook for 2013 inflation has worsened since this time last year,” he said.
He also admitted that the company’s present sales were at the bottom of its target range, although it hoped for improvement once it gained a better understanding of the underlying consumer environment once temperatures returned to seasonal levels.

However, his tame words in the financial statement were in contrast to his comments in The Guardian, where he laid into “incompetent” local councils for the state of the high street.

He said some high streets had been neglected for 20 to 30 years as a result of councils  resistant to change, meaning there were many towns and cities where the stock of shops was inadequate.

High street slump has no effect on video game disties

pac-manHMV and Blockbuster are gone, along with countless independent shops, but their demise doesn’t appear to be hurting video game distributors. In fact, the leading UK distributors told MCV that the closures did not have much of an impact at all.

Mastertronic said the bankruptcies are a non-issue, as most stock is now on a consignment basis. “However, where we have expensive console stock in the retail channel and no practical means of retrieving it quickly, it still poses a problem. The ongoing transition to a digital business has minimised the effects of these closures,” said Mastertronic operations director Dermot Stapleton.

Vogue Distribution sales manager Tom Popple said the poor performance of the retail sector has made had a knock-on effect on game sales, but Vogue is weathering the storm by expanding into new markets. Clock Entertainment exec Jake Wright said it is sad to see big names disappear from the UK high street, but he pointed out that the closures did not have much effect on his outfit.

A number of execs from Bright Red Distribution, Gem and Link Distribution concur. While none of them welcome the demise of high street chains, they don’t appear too concerned, either. Besides, the long-term trend in the gaming industry is online distribution, with constant updates and plenty of downloadable content to keep gamers hooked.

The demise of brick and mortar shops is already boosting online sales, although sales of PC games are not doing very well. High street’s woes did not take a financial toll on games distributors, but they did hurt company confidence and there are not that many positive signs to report. PC sales are down, console lovers are waiting for next-gen gear and casual gaming on mobile devices is bigger than ever.