Tuesday, 30 December 2008

Happy New Year ?

Readers of this blog may have spotted the mysterious absence of the author during the past month, and a period of relatively little activity immediately before. I can tell you that it has not been because of a shortage of issues or comments that I should like to be making.

The fact is that I have been out around the country seeing at first hand the impacts of the current series of large business failures in the High Street and I shall be coming to this blog with a whole raft of things to say in the not too distant future. What is a constant surprise to me about the furore in the press is that it should have been surprise at all, and the fact that we as a nation appear to applauding politicians because they are making promises about how they will manage the economy through this period seems to ignore the fact that have been largely responsible for many of the factors that have led us into this situation.

Agreed, the credit crunch, as we must now call it, was something that started in foreign parts - especially in the USA - but did our senior politicians argue with President Bush that his policies about de-regulation in the finance and credit services sectors were potentially liable to undermine the whole global financial system? Did our politicians - and by this I mean of all persuasions - stop to consider that the housing market was overheating and that personal debt in this country was apparently being hiked up with little or no regard for the consequences? Yet they were told about it - regularly!

Going back a bit... where were the plans to effectively replace the decimated engineering and manufacturing sectors that were left over from the Reagonomics/Thatcherism years? Did they really believe that a reliance on the incomes derived from being a mere hub in the global financial markets was really going to sustain an economy permanently and that allowing the national economy to be measured by the collective value of houses and the performance of major retailers was anything other than 'in your face' consumerism.

The current epidemic of retail businesses entering administration will result in a huge number of redundancies arising from failed larger businesses; this is obviously not good for the economy and disastrous for those losing their jobs. What is not being spotted by the press is the knock-on effect that some of these high profile closures will be having on the SME retail sector.

My prediction is that during 2009 -10 there will be real hardship in small market towns where currently SMEs still dominate. I anticipate that a great number will lose not just their jobs, but probably their entire savings and even their homes. There are things that can be done, but I am as yet unconvinced that there is a political will at national or local governmental levels to recognise previous shortcomings in policy and decision-making, and still further a reluctance on the part of far too many retailers to acknowledge that the downturn has been the final straw rather than the primary cause of their problems.

My hope for the New Year is that the discourse associated with the current difficulties in retailing will embrace a far-wider cross section of the retail trades than just the membership of the British Retail Consortium; that the critical analysis of the circumstances that have led us here will be honest and probing; that all participants in these trades will be empowered to be able to influence their trading environment.