A View From Middle England - Conservative with a slight libertarian touch - For Christian charity and traditional belief - Free Enterprise NOT Covert Corporatism

Monday, January 07, 2008

Retail therapy?

In Shirley, Solihull, the council is in a mad frenzy about building yet another shopping mall, this time with Asda as the "anchor store". However, 2008 starts off with dire warnings of a downturn in the economy. Today, Sainsbury's shares have fallen as much as 8% on concern that the supermarket group may unveil weak Christmas trading figures later this week. That doesn't surprise me. In the local store, generally around 5% of the fresh and chilled food goes for less than the original asking price. Given that a shopping visit will mean seeing that some shelves are completely empty (bad logistics?), then anything up to 20% of the store is being undermanaged in some way.

But it's not just Sainsbury's. The owner of Currys and PC World, DSG International, has issued a profit warning after poor Christmas trading. And the furniture retailers are in a bind. However, John Lewis and House of Fraser are doing well. Which would imply that there is far too much retail space in the UK for the population to get round. Given that online shopping is increasing, the received wisdom is that many of these stores will be just large display units for people to visit, then get their online discounts. Do we need more space for this?

So back to Shirley in Solihull. Any new mall is going to take shoppers away from existing outlets, such as the excellent Touchwood. The council and the developers both talk of creating new jobs, regeneration, and having a "robust" plan in place. Most of it is meaningless cobblers. All that will happen is that the same old retail names will come and go as before. Helping the little man? I'd forget that. Small retailers locally have, in the main, seen through that garbage.

All this is about survival of the fittest. No worries about boarded up shops, a new entry into the declining neighbourhoods chart, just keep on building more retail space.

Can we keep up with their demands?


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