Retailing is in our DNA
Published: 10 February, 2011
Over the past 20 years retail has become the defining force in shaping the UK's towns and cities, writes Sean Kelly
It seems that Adam Smith coined the phrase ‘nation of shopkeepers’ in his 1776 book Wealth of Nations and Napoleon tried to turn it into an insult as “une nation de boutiquiers. ” But what cannot be disputed is the appropriateness of that phrase.
Britain has the business of shopping very much at heart, insists BRC director general Stephen Robertson. “Retail is engrained in our national identity,” he says. “Once condemned as a nation of shopkeepers, these days the UK is proud to be the home of so many shop workers. Around one in ten people in full-time employment work in the retail sector. The range of retailers means the choice for customers has never been higher. Customers have real power. Retail is a democracy and businesses stand or fall depending on the consumers they manage to attract.”
The UK enjoys a substantial retailing pedigree. Bainbridge’s (now John Lewis) in Newcastle is acknowledged as the world’s first department store having opened its doors in 1838. John Lewis itself was founded in 1864. Others – Kendals, (Manchester) and Jenners (Edinburgh), along with Barkers, Peter Jones, Whiteley’s and Harrods got their start during the 1800s. In some ways Selfridges was the odd one out – a proverbial new kid on the block opened by colourful American retailer Henry Gordon Selfridge in 1909.
Selfridge would set a global bar for customer service with his motto: “The customer is always right”. Harrods would do likewise for delivery and logistics with its proposition: Omnia Omnibus Ubique - All Things for All People. Whiteley’s created a memorable retailing slogan – Everything from a pin to an elephant.
Change came with the abolition of Resale Price Maintenance in 1964 and in the roll-back of Sunday Trading from 1991. It came with the arrival of overseas retaili formats, with comparison shopping, multi-channel retailing and even the virtual store and e-commerce.
But mostly it came with the ambitions of retailers. People like Jack Cohen who founded Tesco in 1919 on an East London stall. A decade later he opened his first store in Edgware, North London. It’s reported Cohen took £1 on opening day. Today Tesco has 2,545 stores in the UK with 287,669 staff while worldwide its 5,008 stores employ 472,000.
In 1991, when Shopping Centre debuted among the 500 delegates attending the BCSC Conference in Edinburgh, the world was changing rapidly. The first Gulf War had recently concluded and the Soviet Union‘s General Secretary Mikhail Gorbachev was about to resign.
Tobacco Dock in London had just been sold, reportedly for £15m. Shopping centres including Meadowhall in Sheffield and Whiteleys in London’s Bayswater were daring to open on Sundays. MEPC was preparing to refurbish the Kingsmead and Queensmead centres in Farnborough and the Wandsworth Arndale was prepping expansion plans. Several months previously the A1 Galleria at Hatfield had become he first centre over a motorway in Europe. And in Ireland The Square atTallaght would soon receive BCSC’s annual award. Ram-raiding had become the nastier extension of joy riding.
That year Andrew Martin of Boots was retail’s poster boy for espousing the sector’s campaign against service charges. “There is a war on overhead costs in today’s high streets and shopping centres,” he warned then. And now? “I think there’s still a war on the costs,” says Martin, Boots’ national ratings and (still) service charge manager. “But 20 years on I’m no longer a lone voice. And, to be fair, landlords are taking service charge matters far more seriously.”
For Richard Wright, the first person to grace Shopping Centre’s front page, there is a certain déjà vu to it all. Then Wright was a Norwich Union development executive involved in the Bentall Centre, Kingston; The Exchange, Ilford and The Galleries, Bristol. Today he chairs regeneration company First East and consults for Experian.
“The main headline on the first edition read “Shorter leases to come?” he recalls. “Over the past 20 years it’s been a case of the more things change, the more they stay the same! That’s because of the pragmatism of the market place. We have gone through retailers having the upper hand when developers were trying to let space in the 1990s, to power coming back to landlords and then negotiating advantage returning to the retailers. Now it’s approaching equilibrium with little in the pipeline but few retailers wanting space.”
There are important industry issues ahead – as always, Wright says. “Everyone is still talking about shorter leases, but with those they tend to have an element of turnover. Are you then investing in property or in the tenants? Your return is not only dependent on the strength of that company but also on the ability of the shop manager and staff. We try to make retail property a sophisticated business but in the end it’s always about supply and demand and location.”
TURN BACK TIME
In 2010 BBC Television aired Turn Back Time – The High Street. It examined retailing through 150 years of British history by focusing in on a group of modern shopkeepers who recreated shops, products and sales approaches from the various periods.
Historian Juliet Gardiner, who appeared in the series, believes retailing is a unique part of the UK’s economic and social fabric. And no more so than in recent years. “The key impact in retailing over the last years certainly since the 1990s has been the continuing growth of the supermarket and hypermarket format and the fact that they now sell food and everything else,” Gardiner says. “Other key factors are the spread of chains and the extension of opening hours. Going forward customers will also be more complex and demanding. That gives me some hope that independent shops may flourish again.”
“What makes Britain exciting is competition and the variety,” she adds. “That’s the USP for British retailing. The only constant in retailing is change. Maybe that’s as it should be.”
And what change. BRC’s 2009 figures reveal that UK retail sales totaled £285bn with 2.9m people employed in some 286,690 retail outlets. CB Richard Ellis research indicates some 70.43m sq ft of shopping centre space has been created since 1991.
The Bishop of Liverpool summed it up at BCSC’s 2008 conference. “It’s in our DNA to shop,” The Rev James Jones told the audience. “Cities have always been market places. Buying and selling is the stuff of social intercourse. The 1,000 shopping centres in the UK attracting 100 million shoppers a week will need to adapt to the new realities of expanding global population and diminishing natural resources. It will be a challenging time for the most creative minds in retailing.”
Was it ever not so?