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All hail Mary - saving the British high street with three pairs of socks for a pound

By Tony McDonough on Dec 19, 11 09:03 PM

There's a scene in the TV comedy series Alan Partridge where Steve Coogan's hapless alter ego is making a desperate attempt to impress a BBC executive by reeling off a collection of bizarre ideas for programmes.

"Monkey tennis ... Youth hostelling with Chris Eubank," he says taking the maxim of 'there's no such thing as a bad idea' to ridiculous extremes.

Which brings me to Mary Portas - the 'Queen of Shops' - who earlier this year was asked by Prime Minister to investigate why so many shops are going bust and so many retail premises are lying empty ...

She could have saved everyone a lot of time by saying something like: "No one's got any money to spend, Dave, and, er ... you just put VAT up to 20%." Job's a good 'un.

However, Mary, bless her, has instead spent the last few months looking into the issues faced by the retail sector. And, like Alan Partridge, she's bursting with ideas.

You can read her list of 28 recommendations by clicking here and the full report by clicking here, but I can tell you they include establishing "town teams" to champion local high streets, business rate concessions for entrepreneurs and penalties for negligent landlords.

I found a few of the things she said quite confusing. On one hand she said that high streets were in crisis and that something must be done lest Britain should "lose, irretrievably, something that is fundamental to our society". But then she admits we can't simply turn back the clock to a bygone age.

She then had a go at the supermarkets. There were "too many", she said. But how many is too many?

She added: "It really worries me that the big supermarkets don't just sell food anymore, but all manner of things that people used to buy on the high street."

I've written in this blog before that I don't understand the demonization of supermarket chains like Tesco. They create jobs, they push down prices, increase choice and if they now offer many other things aside from food then all the better. No one stands outside with a gun and forces people to go in.

Mary Portas's idea of removing some of the regulation around setting up market stalls was not welcomed by the Local Government Association which pointed out it would lead to an increase in rogue traders selling shoddy, counterfeit or even dangerous goods.

Fat blokes selling "three pairs of socks for a pound" are not going to save the high street, I don't think, and her notion of a National Market Day just sounds like a lazy gimmick from a flipchart brainstorm.

I was also baffled by her view on the proliferation of bookmakers in high streets. She is right when she says they are often found in deprived areas where people on low incomes are often tempted to gamble their way out of trouble.

But then in the same report she talks about reinvigorating the high street with more bingo halls. Aren't betting shops and bingo halls just basically variations on the same thing? Four legs bad - legs eleven good? (apologies to George Orwell)

Mary's retail pedigree is clearly impressive. As a teenager she had a Saturday job with John Lewis and later worked for Harrods and TopShop.

She was credited with turning Harvey Nichols into a leading fashion brand before eventually setting up her own retail and brand consultancy.

She now regularly turns up on our TV screens to turn around failing retail outlets.

So in the age of celebrity her experience, expertise and fame meant she was the perfect candidate to become David Cameron's retail tsar. Remember, this is the Prime Minister who reputedly hired another TV 'expert', Kirsty Allsop, as an advisor on the housing market, although she denies this.

I think the raising of VAT to 20% from 17.5% hasn't helped the retail sector. VAT is a regressive tax which hits those on lower incomes the hardest.

Perhaps it would have been better to restore the 17.5% rate and put £12bn into our pockets at a stroke rather than having the Bank of England fill the coffers of the banks with its £175bn quantitative easing programme.

But beyond that I'm not sure what else can be done or even if we should do anything at all.

I prefer the concept of creative destruction, which was derived from Marxist economic theory. It espouses that capitalism destroys and reconfigures previous economic orders in order to clear the way for the creation of new wealth.

150 years ago, the horse was the main mode of transportation and there was literally a blacksmith on every corner. Then someone invented the internal combustion engine and the days of the ubiquitous smithy were numbered.

And so it is with the retail sector. Our shopping habits are no longer as linear as they once were. We buy stuff in a variety of different ways - supermarkets, online and yes, still from the local shop.

Many more people live in single occupation households than they did a few decades ago. That means there is no one at home in the day to do their shopping for them. If they finish work in the evening they can't go to the local butcher because he's long closed for the day. Supermarkets offer the flexibility that the traditional high street doesn't.

Just the other week, the managing director of John Lewis, Andy Street, said that offering a variety of services under one roof was actually something the retail sector should be doing more of.

Mr Street said: "What they've got to do is think about how their offer evolves. Particularly, they've got to think about greater emphasis on services that you cannot buy on the internet.

"In a commoditised age you've got to think about what else will be complementary so that's why you see catering and estate agency not being moved off the high streets.

"They have taken more space and what will happen is that there will be other areas - beauty is another one - where people want to go to the high street and buy a service.

"The crucial point is that it's going to be about services, not buying commoditised goods. That's the social experience."

Local and central government can come up with all the initiatives it wants - town teams, business rate cuts, changes to planning law. But ultimately it can't force people to shop where they don't want to.

The high street has to live or die on its own merits. It's called a free market economy. It's not perfect but it's just about the best system we've come up with so far.

A Happy Christmas to you all.

2 Comments

Alan said:

What's wrong with Tesco seling everything? Too much economic power in the oligopoly that is supermarket retailing in the UK. More particularly, the 4CR (concentration ratio - percentage - of the market held by the top four players) is too high for real competition that benefits consumers. When that gets too high competition goes down and prices go up. Only the recession has increased price competition between them - the rules that allow this 4CR are working against it and that's only good for supermarkets and their shareholders.
Andy Street's spot on with services taking over from commoditised goods.

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