Conflicting pressures - potential for problems

There was an interesting piece by Mike Dennis in 'Talking Retail' just over a month ago (16 Jan) where he looks at the potential for opportunity for SMEs amidst the chaos of the growing number of closures and administration orders in the High Street.

I have noted a similar potential for SMEs and added that it is crucial for SMEs to remain focussed on the markets that they know and understand, provided that such a market is to continue in existence - changing shopping habits because of on-line provision, changing technologies, cultural and demographic changes can all substantially undermine previously solid markets. It is right nonetheless that SMEs look to the gaps being left in the market by defunct or retreating businesses with the purpose of exploiting these opportunities.

Unfortunately, there are signs that the credit crunch is having further unexpected impacts upon the trading environment of SME retailers and the threat appears to be coming from the Town Halls. There have been a number of reports in the press recently of local campaigns by small businesses - especially in market towns - against the introduction of parking charges where previously there were none, and raising the charges beyond the rate of inflation where charges already existed.

I believe that these measures are being adopted by local councils simply because it is easy to do and has a marginal effect of voter intentions; I believe also that it is foolish to introduce these kinds of charge changes without substantial and meaningful discussions with the local businesses. In an e-mail conversation that I had recently with an academic we had reason to discuss the interaction between local authorities and SME retailers and he emphasised the difficulties that exist in finding a mouthpiece for these smaller businesses. I did understand, and indeed have discussed this problem previously on this blog - but these logistical difficulties cannot be an excuse for not engaging with small businesses, especially where the impact of decisions has an impact on their businesses and their investments.

The period of recession will not last forever and the local High Streets will be sadder places if not only have they lost their Woolworths and their M&S food offer but that their independent businesses were also lost in an attempt by local authorities to balance the books.