THE retail sector is close to completing its “restructuring” and is moving back into growth, a specialist from KPMG has claimed.
But towns will have fewer shopping streets, says David McCorquodale, the firm’s UK head of retail. He said the acquisition of failed retailers by their shareholders is a positive sign and he is confident buyers will be found for companies such as Little Chef and shirt-maker TM Lewin.
McCorquodale said he expected further retail businesses in Scotland to hit the market in the autumn. He said the collapse of value fashion chain Peacocks, outdoor gear retailer Blacks Leisure and nostalgia firm Past Times was down to several factors including spikes in commodity prices and poor management. Last year he led the sale of Peacocks to Edinburgh Woollen Mill and the £20 million sale of Blacks Leisure to JD Sports.
Recent collapses have been attributed more to the move to online shopping, affecting the fortunes of Blockbuster, HMV and camera retailer Jessops.
McCorquodale, who oversees KPMG’s contribution to the monthly Scottish/British Retail Monitor, said: “Retail numbers are much stronger than last year. Food and fashion did pretty well this month because the weather got better.
“We have seen housebuilding come out of the worst, hotels are still struggling a bit but they will come through. Retail has had most of its restructuring and is going into growth.”
While thoroughfares such as George Street in Edinburgh and Buchanan Street in Glasgow “looked great”, smaller town centres, particularly Paisley, would have to rethink their strategy. “Paisley is probably the worst example,” said McCorquodale. “The problem is how do you make the centre of town attractive. You have to encourage speciality shops, you have to encourage parking and not charge so much, and recognise you might have one high street not three. Turn some back to residential and put housing above the store again and make the nightlife less threatening.
“If you get the right product folk will come to it. You have got to look at planning permission for high streets. It is a social thing. Yes we are all online but you still want hubs that people interact with. If you can find ways of easing traffic, allowing more people to walk around the community and have facilities that communities need, then you will get people back.”
He added that retailers should target demographic trends affecting the UK.
“The older generation is getting bigger while the middle generation have their kids staying home longer and they are providing more care to their parents – that lot are squeezed for cash and time. There are changes in how retailers are adapting to ethnic groups such as Polish grocers. The segments that are going to do well are those that are directed at infants and old folk. There are more young kids again and old folk have money to spend.”