Despite a decline in footfall, and some big name closures, savvy independents are poised to help save and rejuvenate the high street, Pavel Barter discovers
If you listen to those on the frontline of retail, 2020 is likely to see a period of reconstruction for high streets in Northern Ireland. In any reconstruction process there will be winners and losers, but the retail sector is transforming: beyond all recognition in many respects.
Data from Springboard, a retail intelligence company, illustrates the troubles facing retail. Footfall for January, 2020, declined 3.8% from January 2019. Shop vacancies around the province were 14.4%: the highest of any UK region.
Diane Wehrle, insights director at Springboard, pointed out that the last two January results followed a 3.9% rise in January 2018. “NI retail swings from negative to positive,” she said. “That has characterised NI retail since we started collecting data there.”
Yet the high street is facing an unprecedented crisis. According to the Centre for Retail Research, nearly 4,000 shop jobs were lost in Northern Ireland last year. The last decade has seen an avalanche of large retailers closing, including Toys R Us, Tie Rack, and Poundworld. On the whole, Debenhams, which inhabits a 120,000 sq ft premises in Castle Court in Belfast, is also struggling – closing almost a dozen stores across the UK.
“I fear that in the coming months, we’re going to be hit by more stories of erstwhile giants falling by the wayside because they can’t meet their financial commitments, or they haven’t been able to adjust to a rapidly changing market,” David McClure, managing director of commercial property firm Osborne King, told Ulster Business.
According to David, the internet and changing consumer habits have led to massive changes. “It’s extremely pronounced once you get out of the main urban areas and into what were traditionally market towns and provincial settings. It’s a trend that cannot be stopped. We’ve got to face the fact that our towns and cities are going to change forever.”
Yet, behind the closure notices, a quiet revolution is underway. Independents are bucking the trend, opening high street shops and fighting for their right to retail.
“It’s the smaller, more strategic, focused retailers that don’t just survive but thrive,” said Glyn Roberts, chief executive of Retail NI. “Big is no longer beautiful when it comes to retail. Things are going through unparalleled period of change. Retailers who can adapt to that change, innovate, are the ones who will reclaim the future.”
Suitor Brothers, a family-run menswear business in Belfast, is one such maverick. According to Chris Suitor, the store’s proprietor, this shop reacts to changing and evolving market conditions.
“We can scale up or down, depending on how our business is going,” he said. “What allows us to exist and hopefully ride the storm, as an independent retailer, is our ability to be dynamic and change. A lot of multinationals are guided by head office and traditional kinds of sales and retailing. If we see a downturn coming, we can use promotional ideas to drive footfall. We can be more dynamic in the retail space and more reactive with our PR.”
According to Diane, Chris Suitor’s approach is in line with global trends. “Be more flexible, not so standardised, more localised. That’s what people want,” she said.
Retail and hospitality are merging, according to Glyn: “We have to create an experience: family-friendly high streets. We have to make them fun places where people want to come back time and time again.”
Putting the social into shopping certainly appears to be part of Suitor’s success. “We are finding that a lot more people are coming to us for a tailored experience,” said the tailor. “They see their idols wearing tailored jackets, suits, and coats. They maybe go into a multinational store, trying to find that look, then wonder why it doesn’t look the way it does on their phone.
“We deconstruct and reconstruct the garment to make it look the way you want. We allow a lot of autonomy with the staff. There’s a lot of banter. It’s very casual, relaxed. We do not put pressure on you to buy anything. Not being pushy makes the customer buy more.”
The market, meanwhile, may be in the favour of indies. Osborne King has seen examples of independent retailers buying high street properties, due to keen prices. There is business logic behind securing a property on a freehold basis, as opposed to paying rent.
“You can probably pick up vacant retail accommodation, on a for sale basis, in any town, even historically strong ones such as Ballymena and Bangor, for £20 per street foot. In a place like Bangor, they might have paid much more than that in rent,” David said.
Nevertheless, the high cost of doing business in NI is hampering retailers. “We have a perfect storm of cost issues,” Glyn said. “We have a significant rise in the living wage and energy costs. Our members are paying the highest business rates anywhere in the UK.”
A spokesperson for the Department of Finance told Ulster Business that “a full and comprehensive” review of business rates has been undertaken in response to the changes in Northern Ireland’s high streets and town centres. “The review is about ensuring our business rates system is effective, fit for purpose and fair... the public consultation closed in late November and officials have been examining the extensive range of responses.”
According to the spokesperson, the options for rates relief provision for 2020/2021 will be considered in the context of the consultation. But even with rates relief, family-friendly high streets are nothing without local residents. “We need to encourage developers to return commercial or retail premises to residential,” David said.
“Bring people back in and that will create activity. In England and Wales, if you have a vacant office building in the city centre, you don’t need planning permission if you change its use to residential. It is covered under permitted development. We haven’t managed to get ourselves to that stage (in Northern Ireland) yet.”
Chris Suitor believes that multinationals are not doing enough to entice shoppers – and this is why they are failing. “They almost make it an incentive to shop online,” he said. “If I’m a consumer and I can buy £200 of stuff online, get it delivered for free and save £20, why would I even want to go into their store and pay £20 extra?”
Yet technology might also save the high street. Pointy, an app founded by Irishman Mark Cummins, connects the inventory of local shops to online e-commerce channels. When you search for products online, it brings up results from local stores.
“For all the hype around e-commerce and the media narrative of retail apocalypse, people still make the vast majority of their purchases in local stores,” Mark said. “But local retailers have lost out in not having their products visible online and we solve that problem. We help stores to be more visible online. It seemed crazy to us that people had to wait two days for Amazon to deliver a product that could be 100 yards away in a local store.”
Google, when it noticed that Pointy was starting to gain traction with US retailers, took notice. Last month, the tech giant bought the app for a reported £122m.
Footfall statistics might be worrying, but the fight is not over yet. Glyn said that his Retail NI members are positioning for the future and learning from past mistakes: “I wouldn’t be too downbeat about the future of the high street.”
Chris, who continues to make high street retail look smart, concurs. “Whenever I close the door at night and see my name above the door, it’s a wonderful experience,” he says. “It’s a tough market, a tough job, but a wonderful place to be. It’s the most rewarding thing you can imagine.”