Many well-known retail brands have shut down in the past few years. We’re no longer dropping in to Maplins, Toys R Us, Oddbins, LK Bennet, Karen Millen, Debenhams or Mothercare. And that’s just a fraction of the list.
Many others have already re-negotiated their rent costs, or are planning to do so, through CVAs (Company Voluntary Arrangements) to buy time to develop a new business plan that will cope with current pressures of reduced customer footfall, sales figures and profits that are largely held to be attributable to online shopping.
CVAs spread retailers’ challenges – ok, risks – to a wider community of corporate owners of retail space and their shareholders, such as British Land, Hammerson and the Intu Group. Those shareholders, indirectly, include millions of us through pension schemes and government investments. So when media headlines declare “the high street is dying” we ought to take note.
Though is it really dying, or is it a case of transforming to the new reality of a business landscape that now has to include a share of online shopping? Latest figures from the Office of National Statistics show 19% of all UK retailing is done online, and the figure is still growing.
It’s not the only factor that bricks-and-mortar retailers are having to deal with. The level of business being lost to online retailers is enough to tip many shop owners in to a danger zone, and other factors are under scrutiny. Many local council traffic and parking policies, for example, are based on deterring people from going to their local shops and high street, rather than encouraging them to make a visit.
Changes to the way independent retailers do business are clearly needed, though many people are instinctively resistant to change. Even those that do grasp the nettle, who are willing to change and face up to the costs of doing so, may not be able to work out the best options to choose. But they are on borrowed time if they just sit still.
At a recent “Future of the High Street” meeting organised by the non-profit Smiley Movement, Lucy Stainton of the Local Data Company confirmed a very healthy 64% of UK retail outlets are independently owned. When asked which types of retailer are most commonly going out of business she replied “The boring ones!”
Despite the fact that it’s new technology that has created the new challenges, there are many enterprising tech startups that can help physical retailers. Here are five of them.
Launched in 2014 by a husband and wife team who began their retail careers with a market stall, Down Your High Street enables local independent retailers to have an online presence in a digital marketplace. Shoppers can source out-of-the-ordinary products from 530 independent shops based all over the country, and also opt for a deferred payment plan if they wish through collaboration with the fintech payment platform Clearpay.
Dotty Directory provides advertising for small and medium size retailers on a number of websites that have a local focus on areas around the UK. In return, their details are passed on to service providers such as insurance companies who will try to sell to them.
MaybeTech offers courses on using social media for local retailers to raise their profile and attract more customers. Their platform uses AI (Artificial Intelligence) to help larger organisations listen and engage with their customers through social media, benchmark their results, and optimise the ROI of their activity.
LoLo (short for Local Loyalty) has started rolling out a mobile app that enables shoppers to benefit from using tokens that represent cash price reductions in local stores. It aims to increase customer loyalty to local independent shops.
The retailers can in turn use the tokens they accept to enjoy savings on goods and services they require for their business, and receive customer data feedback in order to improve future decision-making. The scheme is networked so that wherever tokens are earned they can be used with any other retailer or service provider that is signed up to LoLo.
Near Street is a search engine that shows the availability of items in nearby physical stores alongside the regular online options. Any stores that maintain online records of stock levels can participate. The system also helps product manufacturers and brand owners check where their goods are after they have been delivered to distribution centres.
To close, I should declare an interest, as I manage social media for LoLo.