HIGH STREET FEA­TURE

The Trea­sury prom­ises lo­cal shops for lo­cal peo­ple

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Can the Govern­ment re­ally save the high street?

In the Bud­get last week Chan­cel­lor Philip Ham­mond an­nounced three mea­sures to try to re­vive be­lea­guered UK high streets.

The first is the cre­ation of a £675m Fu­ture High Streets Fund to sup­port and fi­nance lo­cal ar­eas’ plans to re-in­vig­o­rate their high streets and town cen­tres mak­ing them ‘fit for the fu­ture’.

The sec­ond is a one-third cut in busi­ness rates for com­pa­nies with a rate­able value of less than £51,000 for the next two years.

The third is a dig­i­tal sales tax in­tended to turn the ta­bles on global plat­form busi­nesses which cre­ate value in the UK but don’t pay their ‘fair share’ of taxes in the Chan­cel­lor’s opin­ion.

To­gether these mea­sures are a wel­come shot in the arm for high-street busi­nesses but it’s de­bat­able how big their im­pact will be and whether or not they can ac­tu­ally get peo­ple back to town cen­tres.

The cut in busi­ness rates will sup­pos­edly help 90% of small shops, cafes and bars, but the 10% of busi­nesses which are too large to qual­ify ac­tu­ally pay 70% of the to­tal raised through busi­ness rates.

Sim­i­larly the uni­lat­eral dig­i­tal sales tax is un­likely to dis­suade shop­pers to stop us­ing Ama­zon and the like even if some of the tax is passed on to them.

‘SOME­THING MUST BE DONE’

Due to the ex­plo­sion in on­line shop­ping and chang­ing con­sumer habits foot­fall on the high street is in freefall.

Ac­cord­ing to Bar­clay­card’s monthly con­sumer spend­ing re­port, in-store sales have barely grown this year de­spite the ‘bar­be­cue’ sum­mer and the brief lift from the World Cup.

Fig­ures from re­tail con­sul­tant Spring­board show foot­fall on high streets and in shop­ping cen­tres is in in­ex­orable de­cline while outof-town re­tail parks have seen foot­fall rise slowly but steadily.

The big ques­tion is, if we’re go­ing to get peo­ple back to the high street, what do we want it to look like?

This is ex­actly what polling com­pany YouGov (YOU:AIM) asked shop­pers in a sur­vey car­ried out in May. The re­sults are as sur­pris­ing as they are con­fus­ing.

In-store sales have barely grown this year de­spite the ‘bar­be­cue’ sum­mer and the brief lift from the World Cup

THE IDEAL HIGH STREET DE­PENDS ON WHO YOU ASK

The top five shops on the ‘dream’ high street are a bank (92% of re­spon­dents), a post of­fice (also 92%), a phar­macy (91%), a restau­rant or café (90%) and a clothes shop (87%).

This seems some­what ironic as banks and post of­fices are among the shops dis­ap­pear­ing most rapidly with over 700 high street bank branches and nearly 600 post of­fices shut­ting up shop last year alone.

Also with in-store cloth­ing sales con­tract­ing dra­mat­i­cally as shop­pers take their habit on­line – as il­lus­trated by the likes of

Next (NXT) – the han­ker­ing for more cloth­ing shops is some­thing of a mys­tery.

The least pop­u­lar shops are book­ies (with 73% of re­spon­dents specif­i­cally vot­ing against rather than for) fol­lowed by es­tate agents, dry clean­ers, off-li­cences and beauty sa­lons.

Bro­ken down by de­mo­graph­ics, the re­sults are even more star­tling. While the 65s and over voted for travel agents, newsagents, home­ware and book stores, the 18 to 24-year olds voted for fast food shops, video game stores, cin­e­mas and mo­bile phone shops.

By gen­der, more women than men voted for cof­fee shops, char­ity shops, book stores and beauty sa­lons while in stereo­typ­i­cal fash­ion more men voted for off-li­cences and book­mak­ers.

Sadly de­part­ment stores failed to fire up the young or the old, as borne out by the on­go­ing demise of Deben­hams

(DEB) and the ig­no­min­ious exit of House of Fraser.

HIGH STREETS AF­FECT­ING OUR HEALTH

An­other study, pub­lished last week by the Royal So­ci­ety for Pub­lic Health, shows a sharp di­vide be­tween high streets in north­ern Eng­land and those in the south and paints a wor­ry­ing pic­ture of our town cen­tres.

As well as iden­ti­fy­ing the health­i­est and un­health­i­est high streets out of 70 towns and cities in the UK, the study makes some hard-hit­ting rec­om­men­da­tions.

First, it says there are too many fast food and bet­ting shops so the Govern­ment should al­low lo­cal author­i­ties to re­strict more shops open­ing where there are al­ready clus­ters. It also sug­gests there should be no hot food take­away shops to open within 400m of a school.

Sec­ond, it rec­om­mends all busi­nesses sell­ing food on the high street need to re­duce the calo­ries in their prod­ucts while health-pro­mot­ing busi­nesses should be of­fered dis­counted ad­ver­tis­ing in­clud­ing on so­cial me­dia sites.

Third, it sug­gests rents and rates should be set ac­cord­ing to health-pro­mo­tional ef­forts of each busi­ness, with those that try to im­prove pub­lic health favoured the most.

If the Trea­sury is able to build a co­her­ent re­gen­er­a­tion strat­egy us­ing sur­veys such as these along with its prom­ise to bring plan­ning ‘ex­per­tise’ and a ‘hands-on ap­proach’ then maybe there is hope for the high street.

All these is­sues are rel­e­vant to var­i­ous Lon­don-listed stocks with high street ex­po­sure in­clud­ing Marks & Spencer (MKS), Card Fac­tory (CARD), Domino’s Pizza (DOM) and William Hill (WMH).

One way to en­cour­age shop­pers back to the high street would be to en­cour­age free park­ing. How­ever with coun­cils mak­ing record amounts in park­ing fines (£819m in the fi­nan­cial year 2016-17 ac­cord­ing to fig­ures from the De­part­ment for Com­mu­ni­ties and Lo­cal Govern­ment) there are prob­a­bly too many vested in­ter­ests to al­low such a sim­ple fix to work. (IC)

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