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Sunday, 20 January 2013

Why Are Shops on the High Street Closing? Its’ About Resistance to Change!

Recent developments on the high street have brought to mind the problem of entrenched attitudes which always look upon change as a threat instead of an opportunity.

The demise of old established and reputable names like Comet, Jessop’s, HMV and now, heaven help us, Blockbuster emphasises this problem and commentators have just confirmed it.  Always we hear that they went out of business "because of competition from the internet".

It is probably more the case they went out of business because of resistance to change and a reluctance to take on and absorb new ideas.  They are sclerotic in their retailing philosophy. They all sell or sold products which are ideal for online marketing and yet they allowed others to do it.

And it doesn’t just apply to business in the United Kingdom.  It has been truly said that Amazon should have been started by Barnes and Noble, at the time the largest and most successful retailer of books in the USA.

Once again when Amazon made its appearance, it was immediately labelled as a threat instead of realising that this is the way that the majority of retailing is likely to go and accordingly setting themselves up in the same mode.  Even better, they should have been the instigators of the concept in the first place.

Town and city councils moan and groan about the demise of the high street and the town centres with shops closed and boarded up and with very little likelihood of any improvement.

The question is, why has this happened?  It is probably a combination of difficulty in parking, local rates, high rents and service charges which render the businesses no longer viable, crucially because footfall and consequently turnover have decreased.

In addition there is little doubt that the growth of the out of town shopping malls with their all encompassing “one stop shop” ethos has had an effect. 

However, just take a look around some of the major outlets and lo and behold, closed shops are beginning to make an appearance on the malls as well.

There is little doubt that we are at the start of a retail revolution which is gathering pace.  Retail figures for the recent Christmas trade show that while over the counter sales decreased by around 2%, online sales increased by 18% and this trend will continue and grow even more.

Sure, the overall proportion of online sales to over the counter sales is still relatively minor but the trend is inexorably upwards.  For the first time in the USA, sales of e-books have exceeded those of printed books.

We could finish up, and in the relatively short term, with the high street becoming physical catalogues where products can be shown and demonstrated leaving customers to buy online.

There will still be a place for the small shop, specialising in a  product range and offering exemplary service at commercially viable prices and probably in off-high street locations where there are parking facilities.

However, whether we like it or not, major change is inevitable and there is no way that the old days will return.  Retail is changing and will continue to change and only the brave will survive and prosper.

It promises to be a very exciting time in retailing, online of course, just as long as some brave characters grab hold of the situation and change the way in which they sell and we but things.
Death of the high street?  Possibly, at least in the format that we know today.
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