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NPPF: Victory for town centres, or staving off the inevitable?

By Graham Shone on March 28, 2012 9:13 AM | No Comments | No TrackBacks
It's telling that the responses from the British Retail Consortium and BCSC to yesterday's new planning guidelines were altogether more positive than those given less than a week ago following the budget. 

The main section of the significantly-condensed planning document which would concern retailers and developers is that which deals with the future vitality of town centres, and how planning guidelines can assist the market in making vibrant, competitive, successful centres a reality; and not just a celebrity's dream.

It was pleasing to see the document make reference to the individuality of town centres, and recognise that local authorities need to govern what constitutes sustainable development in their area. The authorities can define the extent of their town centres, and develop their area plans around these parameters. This in turn will mean a greater power to refuse permission to schemes which are seen as being detrimental to the progress of urban recovery, and thereafter, development.

In strengthening the Town Centre First mechanism, the framework has certainly put faith in the long-term ability of struggling town centres to recover - but in terms of shopping and retail, the question remains whether the problems are too endemic for a planning reform to fix. Several planning hurdles may have been removed for town centre retail schemes from a development point of view - but can consumer behaviour change enough to make them 'viable' and 'sustainable'? And how many retailers will survive until the benefits of the guidelines are felt?

The public often give their backing to retail-led regeneration schemes in town centres, only to then either vote with their wallet and shop on-line, or to drive to the out-of-town retail park, where the stores are larger and the parking free. There also needs to be a little more help given to retailers in the battle to pay rent (an opportunity missed in the budget); as there is little point in making the delivery of a gleaming new project easier if there is nobody there to fill it.

The next couple of years will be of interest - as we observe just how quickly the reforms catch on, and how many schemes are turned down due to failing the requisite impact assessments. Only then might we see retailers, developers and, crucially, shoppers turn their eye towards the town centre rather than away from it. The NPPF may be seen as the first step towards town centre recovery - but make no mistake - there's a marathon still to run.

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Budget 2012: The Impact on Retail

By Graham Shone on March 22, 2012 9:49 AM | No Comments | No TrackBacks

The national headlines belonged to the scrapping of the 50p tax rate, and the government's curious decision to alienate everyone over 65 - but there were some elements of yesterday's budget which will have some interesting implications for the retail market over the next couple of years.

Perhaps the aspect mentioned most often by retail experts is over something that the budget didn't do, rather than that which it did. With no respite coming from the Chancellor over the impending 5.6% increase in business rates next month, the cost base for retailers will increase over the next year - and will be in no way offset by inflation, or the cut in corporation tax.

Documents released yesterday indicate that government revenue will be around £592 billion will be raised in the 2012/13 financial year - up £3 billion on 2011/12; and the increase in business rates accounts for a third of this figure.

The decision to relax Sunday trading laws for eight weeks over the summer seems almost like a piece of opportunism, rather than a carefully thought-out piece of legislation, and has gained mixed reviews since its announcement. CBRE's Jonathan de Mello called it a 'timely boost', and that any other decision would represent a 'missed opportunity'; whilst the Association of Convenience Stores have labelled it 'devastating', as it will cost local shops around £480 million in lost trade.

Below-inflation minimum wage increases for adults and freezing the youth rates will certainly be music to the ears of under-pressure retailers; and the increase in personal tax allowances should eventually help consumer spend. The question is whether this increase is coming soon enough - as by April 2013, consumers will have had another year of purse-string-tightening, and the requisite shift in consumer behaviour will be a lot more difficult to engender.

This budget rather gives an impression of the government leaving the retail market in the doldrums for the time being, and rather hoping that the one-time cash injection provided by the Olympic summer can stave off total catastrophe until the population in general has more disposable income in 2013 and 2014. There are, of course, longer term issues over the market which need to be addressed - but the chance for a shot in the arm has gone, and retailers are now left to make the best of what they can out of 2012.


For more from EGi on the Budget - see the Focus Blog for a summary on the impact on regions & click here for a summary of all the major budget stories.

Retail Crime: The 2011 Picture.

By Graham Shone on January 17, 2012 10:23 AM | No Comments | No TrackBacks
The British Retail Consortium this week published the results from its annual survey on retail crime, and it makes for very interesting reading.

Taking a sample of 52 retailers who account for 53% of the total UK retail turnover, BRC painted a picture of retailers experiencing fewer acts of criminality than in 2010, but the cost per incident rising dramatically to the overall tune of 31%. This figure doesn't even include the costs of the August riots - which, instead of causing 2011 to become a giant anomaly, are spotlighted at the end of the report, rather than being factored into it.

Increased cost per incident is one theme seen throughout the report, as it goes through the various felonies in detail. Theft was down 19% on 2010, but each theft cost retailers £85.50, an increase of 21% year-on-year; and there's a similar tale with burglaries, the number of which decreased by 42% to the lowest figure in seven years, yet the cost per incident increased by 83% to £2,093 for every offence. Additionally, employee theft is down 24%, but the value stolen each time has gone up 18%. 

A clearer picture is given by the statistics for robbery, violence towards staff and criminal damage; all of which saw an increase of 20%, 83% and 63% respectively on 2010 figures. Little solace can be taken from the fact that the 83% increase in violence towards staff is mainly verbal, with the acts of actual physical violence the lowest in seven years. Abuse in the workplace is, as the BRC puts it, an 'unacceptable threat', and they encourage retailers to be more willing to report incidents across the board to help put a stop to this.

In addition, the BRC calls for further investment from retailers in crime prevention, an increased awareness of the damage caused by fraud and e-crime to retailers - seen as an 'easy opportunity' for criminals, and further co-operation between the BRC and police forces. The BRC state that a replication of the scenes of August 2011 are 'conceivable', given the deepening economic crisis, and that they can play an important role in communicating effectively with businesses during moments of unrest.

It was just such a moment in August which threw criminality against retailers into the public spotlight - and the figures outlined on the impact of said events are rather harrowing. The riots affected 20,000 employees - 1.5% of the UK's retail workforce; they cost the retailers in the survey £18.3 million in theft, criminal damage, burglary, arson and store closures. Additionally, an impact on sales was experienced by 56% of those surveyed.

One can't help but think that, were the figures from the UK riots included in the report, the figures that indicate 'below-7-year-average' figures for theft, burglary, robbery and criminal damage would not look quite so rosy. If the BRC are correct in their suggestion that a similar spate of lawlessness could hit the UK this year, retailers have to make sure that they are better safeguarded against experiencing a similar loss.

The full report is available here.
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