By Ben Sillitoe
For many business professionals next week’s Budget is more a case of what they don’t want to hear rather than what they do want Chancellor George Osborne to say, and Association of Convenience Stores (ACS) CEO James Lowman is no different.
With a week to go before a Budget statement expected to identify tough challenges for the UK economy, the trade association boss is crossing his fingers for good news across his many different areas of interest.
Talking to Retail Gazette this week, he said: “We are very much hoping not to hear rhetoric and policy which suggest moving towards abandoning a town centre first planning policy.
“I’m encouraged by the results of our initial campaign on this and the government says it won’t change these plans - we don’t want to see any subtle language in the Budget that suggests a move away.”
The ACS has recently accelerated its push to promote sustainable high streets, and it is the preservation and improvement of these community hubs that is topping the group’s agenda at present.
Under the government’s newly proposed Localism Bill, local communities and councils should have a greater say in planning policy decisions and the way their towns are run, and Lowman is keen that within these plans high street retail development is strongly favoured above out-of-town construction.
“The government is looking carefully at how it can stimulate employment and achieve economic growth and there has to be a focus on town centres, villages and secondary retail areas as opposed to out-of-town sites,” he explains.
“High street vacancy rates have nearly trebled in the last two years.”
Lowman, who has spent all but one year of his professional career at the ACS, also suggests that town planning decision makers often favour big grocer applications for out-of-town developments on the basis of misleading promises made about job creation.
“At the crux of it all, though, there is a huge decision as to how we can get the planning decision right for the future,” he adds.
There are of course many other issues Osborne’s Budget must deal with, and a great deal of them will be of interest to the ACS’s membership base, which is made up of a large percentage of the retail industry, comprising small village shops, independent and convenience stores, as well as larger players such as Spar and Co-op Food.
With ties to such a range of companies, Lowman knows any rise to the minimum wage next week would be bad news for the sector, in particular the smaller businesses he represents.
“As private sector employees our members are in no better position to afford pay rises I assure you,” he said.
“An increase could result in benefits programmes being cut, staff losing their jobs and other cutbacks.”
Interestingly Lowman says comparing the new government to the previous administration would result in “a balanced scorecard”, although he says they score differently in specific areas.
He commends the coalition for introducing the ‘one in one out’ business regulation initiative and describes it as “a really positive move”, but is concerned some of the localism agenda could still hand yet more power to the larger supermarkets, while taking it away from independents.
Last week’s announcement by the government that it is implementing a ban on in-store cigarette displays from next year is not welcome news either, with the ACS particularly worried about the financial burden this will have on smaller retailers when they are required to meet these regulations from 2015.
“There simply isn’t the evidence to suggest that the measure will reduce smoking among young people,” Lowman said.
“The concessions made are not sufficient to allay the estimated £40 million cost and disruption that this measure will impose on local shops.”
Aside from all Lowman’s campaigning, it is clear that the businesses he represents in convenience retail are part of an expanding and sought-after market, proven by the larger supermarkets’ move into the sector in recent years.
Sainsbury’s, Morrisons and Waitrose are among the retailers aggressively expanding their smaller store network in the UK this year, highlighting how the fundamental convenience store principles of good service and accessibility are increasingly important to today’s consumer.
With the multiples’ huge buying power though, the CEO worries that too many supermarkets opening smaller stores will have a negative impact on independents, but he wants them to remember why they are expanding in this way in the first place.
“I think is an encouraging sign for the sector that the big companies are increasing their convenience offering because it reminds them why they would like to move into this area of retail - it is because it is a growing sector and it serves an important function.”
And this is a key point indeed. At the heart of all Lowman’s lobbying is the fact he truly believes convenience stores play a vital role in society and that this part of the retail industry needs to be allowed to flourish.
“A good convenience store can be a real anchor for a high street, city suburb or village – all of these areas can benefit from such an offering,” he explains.
“Customers want to buy fresh produce, top-up and shop locally, and they appreciate what these shops can offer them - there is a real demand for convenience.”
The ACS will be watching next week’s Budget with interest, hoping the Chancellor’s decision are made with this in mind.