Rents and Rates

The biggest unavoidable expense in running an independent shop is the rent, quickly followed by the rates. With a recession just around the corner, if not actually here, what is happening to rents? Rents have been going up over the last few years but the trend seems to have halted. In fact the headline figures suggest a 15% decline over the last 12 months. One factor which should be promoting a very welcome downward pressure on shop rents is the recent withdrawl of discounts on rates for unoccupied shops. This ought to put pressure on landlords to do deals and keep supply up. But according to the Telegraph it is in fact leading some landlords to simply demolish their property to avoid the rate bill. The paper reports that as a result of this the government are considering a u-turn on the policy. In the harsher retail climate ahead it would be much better if measures to help smaller enterprises could be maintained.

Tescos

Tesco stores account for £1 of every £7 spent in the UK. This statistic really does take the breath away when you think about it. But the supermarket is getting a lot of bad press lately. If you were the chairman of Tesco pocketing over £5M as a salary you can probably live with a bit of stick from commentators. Hugh Fearnley-Whittingstall's campaign on chickens is hardly going to dent them very much. I have just heard that even Barak Obama has been criticising them. But again, I doubt that many shoppers will put them off. My local store is well laid out, has very good prices and ample parking. The opening hours couldn't be more convenient - they are literally open all hours. But I don't shop there very often. There is something about Tesco I just don't like. I can't put my finger on it. I am not aware that they are really any worse than any other retailer. Deep down for some reason I just don't trust them. I don't know why not. It goes back to before they were the biggest supermarket so it isn't just dislike of the top dog. And it predates my interest in independent shopping. I wonder if all the publicity will seep into the consciousness of more people and eventually begin to limit their growth? Nothing lasts forever and although Tesco are going to be around for a while yet they will be replaced one day. What will it be? The internet maybe? Transport costs? I can't help thinking that the most likely thing that will cheque their growth will be a feeling that you just can't trust them.

Dixons Closing 77 stores

This a fairly old story now but I think it is indicative of a trend Link to news story Basically Dixons and PC World despite huge buying power and buying up excellent shop locations are producing dismal returns on the capital invested in them. The guys in the City have obviously noticed the result in the numbers on the bottom line. But I don't think you need to be a top analyst to see what the problem is from the other end. Buying stuff in these shops is a hideous experience. With a computer of some kind being effectively a necessity nowadays, most of us will have visited this organisations outlets in the recent past. They don't get everything wrong by a long chalk. The chances are that there will be ample parking. The shops themselves are invariably clean and airy and the stock is attractively laid out. Particularly in PC World with the constant changing of categories and technology, I think they do a marvelous job of arranging their goods so you can usually find what you are looking for without too much difficulty. But boy do they get customer service wrong. The staff in the last one I visited seem to be armed with a special kind of ESP which makes them only aware of your presence when you don't need help. Asking for any kind of advice usually gets you the particular prejudices of the young person you have managed to stalk succesfully. They don't make much effort to find out what it is that you need. Buying technology is a strange area. It is possible to spend lots of money on the wrong thing. But it is also easy to lumber yourself with a purchase that is going to waste a lot of your time. You really need a sympathetic person who has the time to understand what you want and what is available. I am sure that many people would happily pay a bit more for that kind of service. In fact, in reality you would probably end up paying less overall by avoiding buying something that might be cheap but which doesn't really meet your needs. I think that there is a really big opportunity here for independent technology and gadget shops.

Aromatherapy

One tempting line of business for independent retailers is aromatherapy. It has a loyal following and is the kind of alternative product that sits well in outlets that are looking for something a bit different from the mainstream. But according to beauty blogger Colin on his Colin's Beauty Pages, this may not be quite as popular as it used to be. He has picked up stories of falling sales and has analysed trends in google searches to suggest that this is an area of declining interest. The full story is over at Colin's Beauty Pages.

Mary Queen of Shops - H.T.Burt Manchester

The incredible Mary Portas continues her quest to save ailing the ailing independent shop clothing retail sector. This week she visited H.T.Burt, a long established Manchester men's outfitters that has seen better days. The first reaction I got when looking at the footage of her first visit was that a conservation order should be slapped on the place. It took my right back to my childhood in the seventies when most shops looked like it. Some of the stock may have been there since then as well. On top of the generally dated look of the clothes, there was also a strange attraction to the colour brown. They also stocked neither jeans nor t-shirts. Mary P was incredulous both at what was on sale - which presumably was likely to sit on the shelves until someone wanted to do an authentic remake of Crossroads - and at the apparent complete lack of knowledge of the men's clothing market of the proprietor and his staff. Only Gordon, the oldest member of the team seemed to have any idea at all. With the energy of superhero Portas dragged them around the local shopping centre and showed them how people who successfully sold clothes did it. The almost unsellable stock was sold off cheaply to the local bowls club (I don't suppose that they were pleased with how they came out on telly!) and replaced with a set of top name brands. Advice from GQ editor Dylan Jones was followed to create an easy to understand and classic complete set of outfits for the average frankly clueless man. The revamped shop looked great, and even better looked like the sort of place that the average frankly clueless man like myself could visit and hope to come out with some decent togs. Take home message - a successful shop should look good, understand its customers' needs and give them a solution to their shopping needs.