Prime Minister David Cameron called it a “clear vision of how we can create vibrant and diverse town centres”, but can Mary Portas’ review on UK high streets really bring about the changes it claims?
While many smaller and independent traders will be encouraged by plans to make it easier to start up and operate businesses in town centres, the larger retailers will be concerned by the suggestion of more regulation and potential blocks to out-of-town development.
Times are very tough for UK retailers right now, with even Tesco, the country’s biggest retail business, struggling for sales growth, but Portas’ suggestion that high street shops could soon completely disappear seems like a wild exaggeration.
Cameron launched this review because of the rising shop vacancy rates seen around the country, but rather than the start of an extinction of high street trading this is more the symptom of a painful evolution of the sector.
Or as research firm Mintel’s Director of Retail Richard Perks told Retail Gazette: “The high street is certainly not in terminal decline, it may not even be in crisis. What’s happening at the moment is a contraction which is almost entirely due to the recession. And in tough times that’s what happens.
“But people still want to shop - that’s why major shopping centres are so successful. And what is a development like Westfield’s at Stratford but a brand new high street?”
Though there may not quite be the crisis that Portas describes, many high streets need to adapt if they wish to remain competitive with out-of-town centres and e-tail.
Portas seems to be under no illusions that a high street of the 1960s can be refashioned in the 21st century and she is right to insist that more investment is needed to improve those centres which currently are failing.
Entreprenuers should be given every opportunity to get started in the business, so High Street Pilots, business rate concessions for start-ups, National Market Day, and the scrapping of market trader regulations, are all welcome suggestions.
More town centre organisations would help focus resources for failing areas but this is nothing new, and one only has to look at somewhere like Newcastle to see the benefits of strong leadership in fashioning an excellent retail offering.
The question that Portas does not fully answer is whether these failing centres deserve saving, or whether we need as many town centres in a multichannel world.
Jon De Mello, Head of Retail Consultancy at CBRE, commented: “For those secondary centres where retailers choose to close rather than open stores, a fundamental shift in spend to the internet and supermarkets cannot be stemmed by allowing more overnight deliveries and reducing the amount of charity shops.
“Fundamentally, if such centres are to survive, they need to provide a more consumer-focused and convenience-oriented shopping trip, with catering and leisure as an integral part of the mix.”
He has long suggested that many empty shops on local high streets would be better served by being converted into residential accommodation, easing the housing shortage, rather than being re-opened in search of customers who would rather shop with Amazon or at Bluewater.
I think that a lot of town centres can be improved and any cutting of regulation to make that easier is to be welcomed but many in the business community will bemoan that she has not suggested a blanket reduction in businesses rates.
That would have helped every retailer in the country and by prioritising it in her report it would have put more pressure on the government, which so far seems reluctant to allow the cut.
Most worrying for major retailers will be the restrictions on out-of-town development proposed in this review and it will be interesting to see the government’s reaction to this suggestion when it publishes its response in the spring.
Adding more planning regulation will not help the sector and Mary Portas’ recommendations alone will not save the high street. Only retailers can save the high street and they will do that by giving the consumers what they want.