The futurists predict that retailing will get more challenging rather than less challenging. A recent report by the Retail Council for Research in the UK predicts that 20% of retailers will disappear in the next five years.
The reasons for this are numerous; some of the reasons are because the retailer has not kept up with technology and consumer trends. Other reasons are the business has matured and there is no succession plan or there are financial restrictions that are out of the control of the retailer.
One reason may be location and where the store is located.
In my travels around the world, I visit many small towns and retail communities and it is clear to me that they can be grouped into one of three categories. Whatever the overall state of the economy in the country, the three categories tend to exist.
“Ghost Towns”
In my travels I come ghost towns, those that were once vibrant retail High Streets and are now mostly boarded. In a recent visit to one town in Ireland, I counted over 50% of the shops in the High Street boarded up and consumers shopping out of town in a new retail park. It does not matter how good an independent retailer you are; it is very difficult to operate a positive, proactive, profitable business when you are surrounded by such despair. Once you have reached a tipping point such as this it is very difficult for a retail community to rebuild a proactive spirit in the retail hub.
“Clone Towns”
On the same tour of the same country I visited another retail hub. This time it was full of shoppers and was doing great business. I recognised all the international retail brands, but found very few local ones. My personal problem was that if you had landed me blindfolded into the retail community and asked me what country I was in, I would not have been able to tell you. This “Clone Town” was familiar to me, I have seen them around the world and there is hardly any indicators to the local culture or traditions. These clone towns are ideal for international retailers, but do not help independent local retailers and I question how much long term vale they will provide to the local community.
“Home Towns”
During my stay in Ireland I also visited what I call a Home Town, a town that supports its local community, is vibrant and a unique, fun place to shop.
I will guarantee that most of the Home Town shoppers are still shopping online, we all do. But, consumers were coming out for the experience, to relax, meet friends and support local retailers.
Many Home towns are built on a number of success, factors:
- They have proactive Chamber of Commerce that helps local retailers work together
- They have local market, sometimes this is a dedicated farmers market, and others are craft markets.
- They have the correct balance between local independent retailers and national and international brands
- They have the correct selection of independent retailers so that customers can do a weekly shop in the same location
- They have vibrant “coffee culture” that allows locals and visitors to linger longer.
- Local retailers are seen to work with the community to enhance the community
- There is vibrancy about the High Street.
Many of us as retailers cannot change our location, but we can work together with other retailers to ensure that we have retail businesses that a located in Home Towns, as the future of retailing will revolve about being in the right community.
John Stanley is a consultant and conference speaker and can be contacted at john@johnstanley.com.au.