They’re not the only reason of course but, as a new survey points out that it’s even grimmer on the British High Street up north, it’s interesting to note that the latest three chains to collapse and leave more empty High Street locations – Barratts Priceless (shoes), La Senza (bras and knickers) and Peacocks (discount clothes) – have all taken the private equity route in recent years.
This basically means loading the company with debt in the hope that a buoyant economy and a subsequent stock market float or trade sale will save the ‘investor’s’ bacon. In these cases the buoyant economy failed to show up. Peacocks, for example, was actually quite a successful trading business but £240m of debt brought it down.
The second factor is greedy landlords. British commercial landlords (mostly the big property companies) charge rent four times a year, on so-called quarter days, and quarterly in advance. Again, this more or less works when the economy is booming but doesn’t at times like this. But will the property companies change their ways even though their customers are going out of business? No chance (unless you’re a retail giant like Sir Philip Green of Arcadia).
Of course the report is right to say that suburban mini-high street locations are on the way out; these grew up when most people had no means of travelling outside their local area. They still thrive, with coffee shops and the like, in affluent areas but not in poorer locations. The report highlights Nottingham as one of the latter and some of its working class suburbs do look as though a neutron bomb has gone off. But the city centre is thriving with a combination of big national chains and smaller specialist shops, plus even a Michelin-starred restaurant or two.
And the UK’s ‘traditional’ retailers are to blame too, at least as much as those other factors, out-of-town superstores and the internet. WH Smith, for example, which used to be the only national chain of bookshops in pre-Waterstone’s days, is a disgrace – diabolical service, terrible store design and a poor range of products. It only keeps its unlovely head above water because of its monopoly of the airport books and newspapers business. Where the queues are even longer and the prices even more eye-watering.
Obviously the High Street needs to offer something different to your nearest Tesco Extra, and in many places it does. But a combination of complacent retailers and besuited fast buck merchants has made the situation far worse than it needs to be.