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Meat and two breads as local butchers and bakers lead resurgence of independent shops

Paul McCartney and Morrissey better look away, because local butchers and fishmongers are beating the recession, having increased by 11.6% during the second half of 2009.

A new report by the Local Data Company shows that independent retailers across the board increased in shop number by 5.6% during the second half of last year compared with a tiny 1.2% rise for multiples.
Off-licences were among the hardest hit as Threshers went under, while fashion outlets also had a hard time, mirrored by a surge in charity shops. Despite blaming Oxfam for hurting the local book trade1, independent booksellers climbed significantly.

Overall, closures for the second half of 2009 were still nearly six times the figure from the first half of 2008, up from 1.9% to 11.5%.

The first half of 2008 saw closures at 1.9% (4,707 closures out of a total of 242,824 businesses) which increased in the second half of 2008 to 5.4% (14,290 out of a total of 264,976) giving a total closure rate for 2008 of 7.2% (18,997 out of 264,976 businesses).

In the first half of 2009 the rate decreased to 6.3% (17,661 out of 281,983 businesses) and it has then fallen back further in the second half to 5.4% (15,834 out of 290,749 businesses) which gives a closure rate for 2009 of 11.5% (33,495 closures out of 290,749).

Liz Peace, chief executive of the British Property Federation, said:

“Landlords' commitment to supporting tenants and helping nurture new business has ensured that retail firms have avoided the kind of chaotic failures many predicted. So while closures are above 10%, it could have been much worse. In order to maintain healthy options for new firms, high streets need to have a certain amount of empty space. But there’s no denying that our obsession with cheap supermarket deals and internet shopping is having a massive effect reshaping the look of retail.”

The changing attitudes of shoppers and over-expansion of some sectors are behind the various trends that have seen sectors like multiple bookshops badly hit. Butchers and bakers have benefited from the explosion of convenience stores which, despite offering cheap alcohol and a broad selection of groceries, don’t offer the kind of quality or personal touch many want from these products.

Matthew Hopkinson, director of The Local Data Company, said: “Multiple bakers have increased massively as a result of Greggs expanding. We have also started to see a growth of specialist butchers such as Halal butchers (16% of all new butcher openings) as well as fishmongers and these openings have predominantly been in the Greater London and South East regions.

“Convenience retailing as a whole saw independents rising in numbers by 5.7% and multiples rising by a lesser 3.5%. Leisure showed the greatest parity between multiples and independents with rises of 4.5% and 3% respectively. The service sector was positive for independents at 6.5% and the multiples were only just up at 0.2%.”

Other key findings by the Local Data Company report:

• Net increase of openings by nearly 4%
• Multiple retailers hardest hit showing an increase of 1.2% whilst Independents deliver an increase of 5.5%
• Fast food, convenience stores, health and beauty, and butchers & fishmongers lead the risers
• Off licences and childrenswear lead the fallers
• Wales and Yorkshire & Humber regions show greatest positive impact
• London, Scotland and West Midlands show least new activity

Definitions

Comparison retailers include electrical, fashion, shoe shops, charity, home entertainment, chemists, opticians and other ‘comparables’

Convenience includes grocery stores and any food or drink outlet no matter the size

Leisure includes any restaurant or café, entertainment shop or hotel

Service includes health and beauty, financial services, all agents and other outlets for service industries

Contact Andrew Teacher on 07968 124545 / ateacher@bpf.org.uk for all interview requests. Guests available for live interview include Matthew Hopkinson from The Local Data Company and Liz Peace from the BPF.

Notes to editors

1. Reference: BBC Radio 4 Today Programme, August 2009. Click and scroll down to 0848 http://news.bbc.co.uk/today/hi/today/newsid_8184000/8184728.stm

2. Background information on retail rents

• During 12 months to June 2009 the average Great Britain prime rent fell by 11.5%.
• This was the largest annual fall in the 22 year history of Colliers CRE’s retail rents monitor.
• It also marks the first fall in rental values for 15 years.
• 90% of the 418 centres covered by Colliers CRE saw a decline in rent June 2008/09. This compared to only 4% of centres for 2007/08.
• The regions that saw the biggest annual fall (2008/09) were the North East and Yorkshire and Humber (both c. -15%).
• London was the best (or least worst) performer seeing a decline in average rent of -6% between June 2008/09. Central London (only) experienced a fall of just 1.1%.

Source: Colliers CRE Research.
Data relates to Colliers CRE opinion of Zone A rents and reflect ‘net effective rent’

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Opening and Closures Report 2009 - Local Data Company