Conservative Small Shops Commission

I probably should have read the interim report of the Commission into small shops in the High Street which was set up by the Conservative Parliamentary Enterprise Group and whose final report was published this month (July 2008). I probably should have read it so that I could comment before the final version was published, but sadly I was not on their circulation list.

Having now read the final version I think that it is worth my while commenting upon it from the perspective of an SME retailer. In general terms this document is welcomed; it certainly is a positive contribution to the discourse about our town centres and the problems relating to the smaller businesses and has a number of interesting ideas that will inform the on-going debate.

There are some criticisms that I would level at it, the first being that the recommendations which it makes to the next Conservative government are written in such a manner that the government in question, should it be elected, would be able to adopt just a few select 'options' from the list and be able to claim that they have followed the recommendations of the Commission. This being the case, then the non-MP representatives on the Commission might feel that they have not achieved all that they set out to do. But, let us be positive because all retailers have to be optimists and let us look at some of the detail - especially the details that on first reading might be seen as not very well thought through.

The Chair of the Commission, Brian Binley, MP, in his introduction speaks about some of the factors that have brought about a dislocation in our town centres such as the introduction of inner ring roads, often constructed to aid access to in-town shopping centres. It is difficult to disagree with this as a stated fact; that this disadvantaged smaller retailers is contained in the reality that High Street rentals whilst not reaching the dizzying heights of the past few years have always been regarded as 'premium'. These premium rates were very often not seriously undermined when the 'High Street' moved in to a purpose built Mall, the original 'High Street' location usually retained a legacy premium rent and, in consequence, business rate. This all served to ensure that the SME retailers was traditionally contained in the more major town centres to the periphery of the core shopping area and in secondary or tertiary streets.

The position of these shops was good enough since they were able to establish themselves and their credibility with their chosen customer group and to build. The arrival of the inner ring road, however, more often than not, cut a swathe through these 'less important' streets and this was very often because a paper exercise by the planners showed this to be the most efficient. Hopefully the current generation of planners entertain more holistic thinking about their towns and are able to understand that roads act both as connectors and dividers. The smaller businesses thus cut off from the new core area have so very often been allowed to decline with minimal external investment. This paper offers no hope for the areas in this position whose final demise has not yet been reached.

Strangely the paper speaks eloquently of the need for markets; I have just this week been visiting the thriving markets in the towns around South Yorkshire. Here the markets co-exist with shops, indeed many stallholders are also shopkeepers, and the public are keen market shoppers - this is especially true in times of downturn. The situation in the South is, however, quite different. The tradition of the market has been steadily eroded and the 'charter' markets have been sanitized and repositioned to support the most recent town improvements. In his book 'The Captive State', George Monbiot in chapter three, wrote about the plight of the St Mary's area of Southampton; an area that had been, like all retail areas, passing through phases of success and decline. This particular ancient area had from the Victorian period been a major base for those victualling the ships in dock as well as providing a local shopping area for a densely populated part of the town. In the 1970s the planners were concerned that the town had stagnated since the rebuilding of the town after the serious war damage. They put in a series of dual-carriageways to serve the 'core' and although the St Mary's area was no more than half a mile from the High Street it was effectively cut off by busy roads which had the appearance to many of being impermable barriers. They lost their ancient market and a significant number of shops. The response by the planning authority was to redesignate St Marys Street as only partly retail and to allow a large number of new residential properties on the street level. This authority has now, following a more major shift in the town centre with the opening of a major shopping centre and surrounding retail park, brought in a new market, on the pedestrianised High Street adjacent to the entrances to the new centre, and these cut into the established trade of the few remaining SME traders to the east of the High Street that have clung on to life in the new 'core'.

So, there are good reasons why I would say that markets are really good, when they are planned and properly operated and where they are not seen to cream off the sales of less mobile traders whose investment is firmly attached to their street. This does not come through in this paper.

The paper also deals with other issues such as transportation, charity shops and a whole range of other important matters, many of which I would agree with the Commission, and which like them I believe needs further work to reach a fair and equitable solution. This is key to all things with SMEs, they need fair access and fair treatment. They, of course, also need to do their job properly and not to complain that their business is suffering when the problem is self-inflicted. I am conscious that this blog is getting a bit long-winded, but I want to mention a few other points from the paper before leaving it.

There are a number of points put forward that I am convinced are a mistake. The proposal to change coffee shops from A3 to A1 may make sense if the beneficiaries were going to be nice little local internet cafes such as appears to be the thinking behind this one, but actually it will be a licence to the major coffee chains to get set up with fewer restrictions than currently obtain. I have no problems with Starbucks, or Costa, or Nero or any other fascias, but if the intention of this proposal is to encourage local enterprise - then it will fail.

The paper refers quite a number of times to the retention of the needs test in PPS6, I would reiterate my previous blog on the subject and say clearly that there is a need for local control and for ensuring a balance in the towns of the retail mix available, but the need test, even just applied to edge or out of town sites is not as pragmatic an approach as a full impact assessment - and providing that the SME retailer is properly represented in that assessment process, then the needs test is no longer viable.

It is crucial before the development of any new initiative, such as the Community Hub Enterprise areas' that the local population actually decides what the role is that they expect of their town centre. Even major town centres often play multiple roles, such as being the regional shopping centre as well as the local district shopping centre. This becomes increasingly true as greater numbers of people move into new residential areas immediately adjacent to or actually within trading areas. The amount of public space out of trading hours, for instance, is dramatically reduced in a regional shopping centre scheme than would otherwise be the case in a local shopping scheme.

I could go on, but I am in danger of giving the impression that I do not like this paper - and that's not true because I do, and I think it deserves wide recognition. But I see it as a point along the journey rather than the destination.

Praise for Sheffield

Earlier this week I attended a meeting of the Federation of Small Businesses held courtesy of Costco in Sheffield. The meeting had been trailed as the launch in South Yorkshire of the Federation's 'Keep Trade Local' (KTL)campaign, something which has been the focus of my attention for a number of reasons recently and the keynote speaker was to be none other than the Leader of Sheffield Council, Councillor Paul Scriven.

Because I had not been fully engaged with the 'KTL' campaign for reasons that I have discussed with the FSB nationally I arrived at the meeting fully expecting to be at odds with the Federation and that a politician was to address us might simply add fuel to my concerns. In the event I was delighted to find that the evening was full of very positive surprises; the first came with a short chat with the local FSB chairman, Tony Cherry, who told me more about the background behind the 'KTL' campaign than anyone in the FSB had previously managed and it was fascinating. I discovered that the idea had been born, not in the FSB offices in London, where currently the campaign seems to be managed from, but in Sheffield. I learned that it had come about because of the concerns by the local FSB members that in the wake of the June 2007 floods the area was swamped by companies being brought in by insurers to carry out the remedial works that were desperately needed. Why, they asked, were local firms not used by the insurers?

The FSB 'Keep Business Local' campaign has been seen by many, including myself, as essentially a campaign about local food retailing - but I was wrong. It is much more, and includes the idea that procurement by governmental and publicly funded organisations should enable tendering by small businesses. Which is the cue to introduce Councillor Paul Scriven, the Leader of Sheffield City Council.

Cllr Scriven formed his administration after the recent local elections and apparently began his period in office with a most un-politicianlike apology to businesses in Sheffield. The apology was made, he said, because he felt the the City Council had for some time not been responsive to the needs of businesses and, possibly worse, had created an environment that was not conducive for local businesses to thrive. He then laid out the plans that he was putting into place to change things around. He has already appointed a new Cabinet Member for Employment and Enterprise and is intending a whole raft of new measures including semi-formal structures for consulting with local businesses of all sizes.

It remains to be seen whether Cllr Scriven will be successful with his initiatives, but I have to say that I have been around local politicians for a very long time and it was the first time that I have seen simple responses to the questions that were put by local people. These answers seemed considered, honest and most importantly straightforward and short! I think that we will hear more of Councillor Scriven and Sheffield City Council, which I applaud and wish well in their endeavours.

PPS6 Consultation and what Councils need to remember!

The Government is carrying out a consultation about the future shape of PPS6, the guidance to planning authorities about planning town centres and other retail areas. This is one of the most important pieces of Government regulation in the development of town centres and it therefore justifies a few minutes of the time of those businesses who are often the most badly affected by local planning issues - SME retailers.

I have argued for a long time that SME Retailers are disadvantaged in terms of the influence that they bring to bear on local planning issues, far less than their larger counterparts, and one reason for this is that too many SME retailers fail to look beyond their doors for things that may influence their business until it is too late to do anything about it. Well, here is an opportunity to redress that imbalance just a little!

Take the time to visit www.communities.gov.uk/pps6consultation and have your say. Personally I am fully in favour of the removal of the 'needs' test which produced unintended consequences that served to disadvantage sectors, especially SME retailers. I am also in favour of the introduction of an impact assessment; however, unless the issues of disadvantage in the exercise of the power of influence are addressed, and the SME sector is effectively consulted on town centre planning strategies, then this too will have unintended consequences.

Another factor that seems to act as a barrier to effective communication is the view held by many local authorities that SME retailers are just too disparate a group and it is costly and time consuming to communicate with them on detailed issues - meetings of local traders simply cannot cope with detail. Local Planning Authorities then need to be mindful that one of the major factors differentiating these businesses with those of the much larger competition on the High Street is that the SME retailer has most likely committed 100% of their investment in their site and in their town and that their capital circulates locally - the same cannot be said of the more common fascias who are commonly committed to the competing towns too! This fact deserves some reciprocal commitment from the local authority. It would, of course, be foolish to believe that the local authority would be able to consult with all the local SME businesses, but then they do not consult with all the major fascias either - there is usually a small group of locally influential players and very often this will include M&S, Debenhams, Boots, and others of a similar status in the High Street. It is essential to my mind to ensure that an articulate champion of the SME retailers, who is up to date with the concerns and the issues affecting the SME sector in the town is consulted and as involved with the processes as those previously mentioned are.