Ocean Terminal turns to quality craft businesses as battle with internet for customers hots up, writes Emma Newlands
As the high street continues to fight the “clicks v bricks” battle against online retail, and consumers’ shopping expectations rapidly evolve, retail centres are having to rethink how they can engage with customers to keep the tills ringing.
Amid what has been described as an “incredibly challenging” trading environment for Scottish retailers, sector experts believe that some pretty creative solutions are becoming an essential lifeline, as takings come under pressure and shops continue to vacate the high street.
Creativity is certainly at the heart of a project being run at Leith’s Ocean Terminal, which believes that the platform it is providing to independent craft businesses is “leading the way at creating a new type of shopping centre”.
It came about when Lynzi Leroy, from the Scottish Design Exchange and owner of A Space to Share, took the concept to the capital shopping centre, and it was welcomed by general manager Denis Jones and deputy centre manager Michelle McLeod.
They are said to have seen the win-win potential of her suggestion, which involved welcoming businesses focused on unique products, created by individual local artists and put together in a sustainable way.
A deal was struck whereby the centre offers small businesses a site to sell their wares for a reasonable rate, providing them with access to the wider public. Crucially, the sellers do not have to give their landlord a percentage of their sale prices, which removes what can be a huge stumbling-block for many independent retailers.
Known as “the hub”, the project includes The Facility, Limitless Scotland, the Scottish Design Exchange and DOK Artist Studios, co-ordinating to create a modern shopping experience.
There are now 60 enterprises selling their wares, with everything from soaps to sofas and brooches to bicycles, and so popular is it proving that there is already a waiting list for businesses to take part, Leroy told Scotland on Sunday.
“There’s a huge appetite from the public for these unique crafted Scottish goods,” she said, adding that many businesses have started working together to create joint products or share overheads and therefore reduce costs.
Leroy describes the project as “trying to turn the high street on its head,” and it comes as a study published last week found that an average of five stores closed every day in Scotland in the first six months of 2015.
According to the analysis by PwC and The Local Data Company, there was a net reduction of 26 shops in the period.
Martin Cowie, head of private business for PwC in Scotland, said the digital revolution affecting the high streets “shows no sign” of diminishing.
“Landlords are also being hit by this tug-of-war between ‘clicks’ and ‘bricks’,” he added, noting the fall in average unexpired lease lengths and lease-renewal rates. He also predicted a rise in short-term leases “and more temporary pop-up type formats”.
Ocean Terminal is certainly following this strategy, and MacLeod said it has been “working hard to create something different”.
She added that customers want access to high-street brands, with the mall building an extension of 22,000 square feet to accommodate a new flagship H&M store.
“But alongside the familiar they want the unfamiliar: retail outlets that will challenge their idea of what shopping is all about,” she notes.
While Ocean Terminal neither benefits from the footfall of the city centre or the convenience of an out-of-town location, it does enjoy footfall due to its proximity to the Royal Yacht Britannia, providing access to this top attraction.
The shopping centre opened in 2001 after Forth Ports linked up with HBOS in a joint venture to develop and manage the centre. In 2012 it was offloaded by Forth Ports to European real-estate investor Resolution Property for an undisclosed sum, and earlier this year a plan worth more than £6 million to expand the centre was announced.
Subjit Jassy from Resolution looked at the strategy of the hub project, stating: “This is about good marketing principles, listening to customers and giving them what they need. We are trying hard to create something that will surprise and involve customers.
“Being able to meet an artist, handling unique products where there is only one of its kind in existence, discovering how they are made, is an experience that you don’t get from other retail environments.
“We’ve pushed at all the boundaries to make this happen at Ocean Terminal,” he said, describing the project as “genuinely innovative”. Jassy added: “It’s a way of charting a new direction for retailing and who knows, maybe for the wider Scottish economy too.”
As for its future, the site was initially taken on a six-month basis, set to run until January, and Leroy said there is potential to extend this if funds can be found to support its continuation.
In terms of extending the geographic spread of the project, she added that she would like to grow it around Scotland, particularly in small towns such as Hawick and Galashiels in the Borders.
Jassy praised its progress, stating: “The excitement and energy of bringing artists, makers and craft talent into the centre has lit up the mall, and strengthened connections with the vibrant and creative community which lies around Leith and Ocean Terminal. It is exciting to be working on the future of retail.”