Hard times on the high street call for wholesale change

The great shift in retailing is not confined to Britain’s high streets.

I was in New York last week, and could not help but notice that while the streets of Manhattan were heaving, it was only the coffee bars that were doing brisk trade. The pavements were crowded but, by and large, the shops were eerily quiet.

Stores were still offering discounts from the summer while proclaiming the pending Black Friday discount bonanza. The sense of struggle was compounded by the knowledge where I was in Midtown contained some of the most expensive real estate on earth.

Back in London, the scene was the same – lots of people and, apart from a few tourist magnets and coffee shops, more or less deserted stores. The sense of struggle was compounded by news of further planned Marks & Spencer closures, coming on top of losses of branches of Debenhams, House of Fraser, New Look, Carpetright and other retail chains, as well as banks and restaurants.

Our city and town centres are in trauma – a perception reinforced by the latest study by consultants PWC. It found a record number of shops had closed during the first six months of the year. A total of 2,692 outlets vanished between January and the end of June. In their place, 1,569 opened, making for a net loss of 1,123 stores. As for the new ones, the likelihood is they were yet more coffee shops, estate agents, charity shops, vape sellers, nail bars and pop-ups.

According to PWC, the rate of store closures is running at 14 a day. That net figure of 1,123 compares with 222 for the same period last year. In other words, it’s getting much worse.

Any business selling items that can be bought online is vulnerable. So, hardest hit are the fashion houses, suppliers of electrical appliances such as fridges and washing machines, and banks. Pubs and restaurants, meanwhile, have fallen foul of consumers preferring to stay at home, and of overcapacity.

The situation is fast turning into a crisis, one that goes beyond the disappearance of thousands of retail and supplier jobs. It’s about the wholesale destruction of community, the eradication of the central part of every city and town. They’re heading towards becoming “doughnuts”, empty and soulless in the middle, economically active and populated around the outside.

While solutions have been put forward – including prettifying our streets, encouraging more “artisan” shops that sell products that cannot be easily replicated online, devoting more space to specialist foods, making town centres more oriented towards “destination” and “events”, and extending opening hours – we have to face facts: in the end, this is tinkering at the margins and is unlikely to make a blind bit of difference. Online has seen to that.

The government has to act, and fast. An attempt at levelling the playing field between bricks-and-mortar and digital retail must be made. That requires a radical overhaul, with reductions in business rates. Retailers who sell largely via the internet must be required to pay a tax to reflect the soaring number of delivery vans clogging our streets. Their corporate structures, often designed to avoid paying taxes, need tough examination – and they should be required to meet a sales charge or a form of taxation they cannot easily escape.

Such measures would make a difference, as would greater flexibility and understanding from landlords. However, they will not prevent what is becoming an unstoppable tide. Something more drastic has to occur.

There’s no dodging the reality: we have far too many shops. Not for nothing were we once described as a nation of shopkeepers. Government and councils, working with landlords and retailers, must take a hard look at shopping districts and at the main streets, but also secondary areas just off the prime drag.

They should ask themselves – and answer honestly – just how many of the outlets are actually required, how many could flourish against rising digital shopping?

Armed with that information, they should ringfence a central area as a dedicated shopping district. It should be pedestrianised, and provided with adequate, well-lit, easily accessible car parks. Street parking should be made more available, and wardens told to be more lenient. Shops should be told to stay open later. Attention ought to be paid to making streets attractive and appealing.

For the rest, there must be an acceptance they can no longer be devoted to retail. There is simply no requirement for such a volume of shopping space. Such areas need to be turned over to mixed use, to shops, bars and restaurants, yes, but combined with offices and residential accommodation. Rather than die, as at present, the area would come alive with workers and residents – and still have that all-important “community” feel – while fulfilling demand for offices and housing.

It’s the only solution, one that avoids the dreaded doughnut. Anything else on its own will not be sufficient. But a cohesive, joined-up plan, entailing cuts in business rates, less onerous rent increases, new taxes for online sellers, a marked and deliberate reduction in shop volume, a much-improved but smaller central retail district, and greater variety of usage outside, will work.

Instead of standing by and watching as retailers perish one by one, and our city and town centres face death by salami-slicing, we should take the lead. We are simply over-shopped. The sooner we realise that, and do something about it, the better.

Chris Blackhurst is a former editor of The Independent, and director of C|T|F Partners, the campaigns, strategic, crisis and reputational communications advisory firm