In recent months there have been many headlines about retail businesses failing. There are also reports about the rise of online shopping. This has led to some people predicting the death of physical shops, but is retail shopping in a terminal decline?
According to David Mitchell from Shepherd and Wedderburn, organiser of the conference Property 2018, retail shopping is far from dead. He points out that the retail sector represents 11% of the total UK economy in 2017 and employs over 4.5 million people.
He recommends that to compete with online retailers, shops need to change. Research has found that many shoppers prefer to visit mixed-use retail and leisure parks rather than the high street. Many people still like to see goods before they buy, but shops need to adapt to changing expectations.
Mitchell believes that the problem with failed chains such as Toys R Us is that they stuck with a business formula that had once been successful but was no longer relevant to their customers. He said that shops need to think differently. For example, Sainsbury’s has added Argos sections to some of its stores, and Selfridges has trialed a boxing gym in one of its stores. Some stores have added yoga studios and champagne bars.
Mitchell said that landlords, retailers and communities should be “actively promoting, encouraging and facilitating the enhancement of customer experience in innovative, yet cost-effective ways.”
Commercial mortgages are available to help finance new retail developments that can meet changing customers’ expectations.