Pol­icy can help with chal­lenges

Philip Bain of shred­ding com­pany Shred­bank shares the se­crets of his en­tre­pre­neur­ial suc­cess with Damian Camp­bell of Fleet Fi­nan­cial

Belfast Telegraph - Business Telegraph - - Front Page - byey ire­land chief economist neil gib­son In next week’s Econ­omy Watch, we hear from An­drew Webb of Baker Tilly Mooney Moore @Ey_ire­land

Economist Neil Gib­son fo­cuses his at­ten­tion on the High Street

The an­nounce­ment of the ad­min­is­tra­tion of Pound­world and House of Fraser store clo­sures have re­fo­cused at­ten­tion on the High Street. Hap­pily, the Belfast House of Fraser store was not one of the clo­sures, but re­tail profit warn­ings have been a fea­ture of the first half of 2018. Is this trend set to con­tinue and can pol­icy re­spond in any way?

Per­haps this is a nat­u­ral evo­lu­tion of the re­tail mar­ket and pol­icy should be pas­sive as the new re­tail world emerges? This is a sub­ject I have writ­ten about be­fore but it seems timely to re­visit the topic — af­ter all, it is North­ern Ire­land’s largest sector.

Any ar­ti­cle on the high street should start by say­ing there are many re­tail­ers do­ing very well in­deed, de­spite the dif­fi­cul­ties. New busi­nesses are still open­ing and the in­flux of tourists to North­ern Ire­land, cou­pled with record num­bers of peo­ple in work, is pro­vid­ing a healthy cus­tomer base.

But point­ing to these suc­cesses, with­out recog­nis­ing the pro­found change un­der way in the re­tail sector, would be to ig­nore the risks that the trans­for­ma­tion presents for many ar­eas and in­di­vid­u­als. The move to on-line re­tail­ing is well doc­u­mented (the Cen­tre for Re­tail Re­search puts the fig­ure at close to 18% of to­tal sales in 2017 in the UK) and the abil­ity for con­sumers to price check at the tap of a but­ton has rev­o­lu­tionised cus­tomer/re­tailer in­ter­ac­tion.

So­cial at­ti­tudes are chang­ing too. Much has been writ­ten about peo­ple’s in­creas­ing will­ing­ness to pay more for ex­pe­ri­ences than prod­ucts. The rush is on to make shop­ping an ‘event’ to en­tice cus­tomers. Just as gar­den cen­tres trans­formed into restau­rants and gift shops to aug­ment the plant buy­ing ex­pe­ri­ence, cafés, cof­fee shops and even bars are pop­ping up in re­tail stores to at­tract the ex­pe­ri­ence shop­per. Clearly, there will al­ways be a need for a phys­i­cal store. The abil­ity to touch and feel prod­ucts be­fore buy­ing, to be in­spired to pur­chase by a cap­ti­vat­ing dis­play or demon­stra­tion and the need for ad­vice to help make a pur­chase are all rea­sons to be re-as­sured that the shop still has a fu­ture.

How­ever, if the pat­tern of con­sump­tion is chang­ing and threat- en­ing the vi­a­bil­ity of high street shops, the crit­i­cal ques­tion is whether pol­icy should play a role? Is it sim­ply an evo­lu­tion of a sector and, there­fore, would it be un­wise to try and swim against the tide? There are rea­sons to sug­gest pol­icy will need to play a role.

Firstly, rates are a ma­jor source of in­come and re­tail­ers are a sig­nif­i­cant con­trib­u­tor to the rates base. If there is a re­duced high street pres­ence, then bills will have to rise else­where to fill the short­fall. For coun­cils, for whom rates are such an im­por­tant com­po­nent of their finances, this is at the very least an is­sue they need to con­sider. Given the lengthy list of ex­emp­tions from ‘full-fat’ rates in North­ern Ire­land, the con­tri­bu­tion to rate by re­tail may need con­sid­er­a­tion.

An in­creased fo­cus on tax­a­tion of con­sump­tion, not ‘ bricks and mor­tar,’ may be re­quired.

Sec­ondly, va­cancy is eco­nom­i­cally dam­ag­ing in many ways — not just the lost in­come but also the knock-on ef­fect it has on foot­fall and on neigh­bour­ing properties. There­fore, a pas­sive pol­icy stance as high streets slowly de­cline would be very dam­ag­ing, un­less of course al­ter­na­tive uses ap­pear to fill the void and pre­vent the va­cancy blight.

Thirdly, re­tail is a hugely im­por­tant em­ployer. The lat­est data places whole­sale and re­tail as the re­gion’s big­gest em­ploy­ing sector with 136,000 work­force jobs, and this is de­spite re­cent losses in the sector (down 6,000 since Q3 2016). Not only is it a ma­jor em­ployer, it offers flex­i­ble hours, opportunities across the skills spec­trum and, for many, is the first step into the world of work. This in­creases its im­por­tance from a pol­icy point of view. If NI were to lose 10% of its re­tail employment, this would equate to 13,600 jobs — more than the to­tal pop­u­la­tion of Stra­bane.

Tech­nol­ogy is re­plac­ing jobs in the re­tail sector and, cou­pled with the struc­tural changes dis­cussed above, our fore­casts are for a fur­ther con­trac­tion in over­all re­tail employment num­bers. There are macro-eco­nomic fac­tors at play too in this out­look. A re­trac­tion in con­sumer spend­ing is pre­dicted as pay rises are not pro­jected to out­strip in­fla­tion sub­stan­tially. There will be a need for in­creased pro­vi­sion for re­tire­ment and pos­si­ble tax in­creases for health and in­fra­struc­ture spend that will re­duce re­tail spend­ing ca­pac­ity.

The good news is that the pol­icy debate is rather healthy. Con­sid­er­a­tion of busi­ness rates in NI con­tin­ues and the var­i­ous ex­emp­tion regimes con­tinue to be looked at.

The North­ern Ire­land Re­tail Con­sor­tium and the re­vamped Re­tail NI group have an ex­ten­sive set of pol­icy rec­om­men­da­tions fo­cused on en­sur­ing the on­go­ing vi­brancy of the sector.

As a sector, it is of­ten in the back seat of the pol­icy debate — con­sid­ered a sec­ondary ser­vice only sup­ported by in­comes gen­er­ated else­where. How­ever, as a vi­tal part of the employment base and of the phys­i­cal land­scape of our towns and cities, its trans­for­ma­tion is not some­thing to sim­ply ob­serve as the im­pli­ca­tions will be sig­nif­i­cant. As al­ways, in­di­vid­ual firms will buck the over­all trend and still re­tail­ing will be a crit­i­cal em­ployer across North­ern Ire­land in 10 years’ time.

Yet, as the trans­for­ma­tion of many of our town cen­tres con­tin­ues, the pol­icy debate, es­pe­cially around rates, should re­main lively. Re­tail­ing is chang­ing and pol­icy will need to change too.

If a chang­ing pat­tern of con­sum­ing threat­ens high street shops, should pol­icy play a role to help?

If NI was to lose 10% of re­tail jobs that would be 13,600 — more than Stra­bane’s pop­u­la­tion

En­tre­pre­neur Philip Bain, co-founder of Shred­bank, the lead­ing North­ern Ire­land mo­bile doc­u­men­ta­tion shred­ding com­pany, is on a mis­sion to help other lo­cal busi­nesses en­sure they are legally and en­vi­ron­men­tally com­pli­ant when it comes to the dis­posal of their most pre­cious re­source — in­for­ma­tion.

Just named Best Es­tab­lished Small/medium Busi­ness at the Belfast Tele­graph Busi­ness Awards in part­ner­ship with Ul­ster Bank 2018, Shred­bank con­tin­ues to en­joy growth, with height­ened at­ten­tion around new data pro­tec­tion leg­is­la­tion and com­pli­ance

Damian Camp­bell, head of cor­po­rate sales at award-win­ning con­tract hire and ve­hi­cle man­age­ment firm Fleet Fi­nan­cial and Belfast Tele­graph award spon­sor, finds out what makes him tick and how oth­ers are ben­e­fit­ing from his ex­pe­ri­ence. Qshred­bank

is a decade in busi­ness with many awards. How did you do it? AWE

of­fer a dis­tinc­tive and in­creas­ingly vi­tal ser­vice. Any or­gan­i­sa­tion that gen­er­ates phys­i­cal, con­fi­den­tial in­for­ma­tion must have the means to de­stroy it in a legally and en­vi­ron­men­tally-com­pli­ant way, or face not only le­gal and fi­nan­cial im­pli­ca­tions, but the po­ten­tial fall-out from a gen­uine data breach. Our mo­bile shred­ding ser­vice means we travel di­rectly to our cus­tomer’s site and take care of their needs within their full sight and with­out the need to trans­port their doc­u­ments else­where. Our cus­tomers are wit­ness to that event which means that they get full peace of mind. Con­fi­den­tial in­for­ma­tion is too pre­cious to do any­thing else or to trust it with oth­ers.

Qwho

uses your ser­vices? AWE work with com­pa­nies and pub­lic bod­ies of all sizes and types, pro­vid­ing on-site ser­vices on both a re­tained and ad hoc ba­sis from sole traders to multi-na­tional firms with thou­sands of staff. We also sup­ply locked doc­u­ment bins which clients can use to safely store con­fi­den­tial doc­u­ments and ma­te­ri­als be­fore shred­ding.

De­mand for our ser­vices con­tin­ues to grow. Tight­en­ing Gen­eral Data Pro­tec­tion Reg­u­la­tion (GDPR) leg­is­la­tion across the EU, as well as grow­ing aware­ness of the im­pli­ca­tions of Iden­tity Fraud and cor­po­rate com­pli­ance, means we’re in high de­mand. By shred­ding on site, we fully elim­i­nate all the risks involved. Qwhat’s im­por­tant to you? Aour staff, a drive for ex­cel­lence, cus­tomer care and the cul­ture of our com­pany. We’re fo­cused. We’ve a strong busi­ness model which is built for growth but with flex­i­bil­ity built in. We’re also pas­sion­ate about the en­vi­ron­ment; what we do helps busi­nesses to im­prove that too. We are sig­nif­i­cantly involved with two char­i­ties — Alzheimer’s Re­search and The Prince’s Trust and I reg­u­larly speak on sub­jects such as en­trepreneur­ship to uni­ver­si­ties, col­leges, schools, coun­cil and en­ter­prise agen­cies.” QIS

cor­po­rate and so­cial re­spon­si­bil­ity (CSR) im­por­tant? Aab­so­lutely.

As a com­pany, and through my own busi­ness start-up ad­vice book Start to Grow, we’ve raised more than £65,000 for The Prince’s Trust in North­ern Ire­land, a char­ity which helps young peo­ple through ed­u­ca­tion and train­ing. The book is based on my own per­sonal ex­pe­ri­ence of launch­ing and grow­ing a busi­ness dur­ing a re­ces­sion and I’m re­ally thrilled with the suc­cess it has be­come. We also sup­port Young En­ter­prise, which does fan­tas­tic and im­por­tant work in en­cour­ag­ing en­trepreneur­ship amongst young peo­ple. Qwhat

ad­vice would you give to new start-ups or would-be en­trepreneurs? Athe

first thing I tell any­one look­ing to set up a busi­ness is you’ve got to get to a point where work­ing for some­body else fills you with ab­so­lute dread. You need a real de­sire for free­dom, power and con­trol.

If money is your only mo­ti­va­tor, and you’re not mak­ing any money a year af­ter you start your com­pany, then you’re go­ing to be de­mo­ti­vated. But if you’ve got the free­dom to set your own agenda, you’re go­ing to per­se­vere un­til the busi­ness starts to break even. Stick with it as long as you can, and, with the right ap­proach, your re­ward will come. Qwhat’s

next for Shred­bank? Aafter

10 years in busi­ness with my busi­ness part­ner James Car­son, we re­main com­mit­ted on grow­ing fur­ther and to con­tin­u­ing to de­liver the most innovative and the most con­fi­den­tial so­lu­tion to our clients. We’ve grown and traded well through the re­ces­sion and we’ve en­joyed great suc­cess — but we never rest on our lau­rels. There will al­ways be chal­lenges but we feel we’re equipped and well-planned to ad­dress them.

Fall of the House of Fraser: the department store has an­nounced sev­eral clo­sures across the United King­dom

Philip Bain, of Shred­bank, and Damian Camp­bell, Fleet Fi­nan­cial. Right: Philip re­ceives the award for Best Es­tab­lished Small/ Medium Busi­ness from Damian of Fleet Fi­nan­cial

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