Are our High Streets really struggling?

WHAT do you think the worst thing about Christmas is?

Some people might say it is the shops. Shops that are too busy and bustling, shops playing carols that are too loud and repeated too often, shops with long queues and impatient customers waiting to find that perfect gift for that perfect someone.

Customers this year will outdo themselves, spending £74bn on presents, transport, food and drink in the six weeks before Christmas. The average household will sink £775 - £17 more than in 2013.

But, yet again, stores and shopping centres will see their share of festive spending fall. Instead internet sales are predicted to rise to more than £17m, with the number of gifts bought on a mobile increasing by 300 per cent.

These statistics point to a wider picture, where 16 stores close per day in Great Britain. Once successful fashion outlets and shoe shops have been replaced by leisure facilities, betting shops and pound stores. Consumers have moved off the High Street, choosing to travel to retail outlets or spending their money online, taking advantage of the often free returns services.

Deb Knibbs helps run The Labyrinth, a gift shop on Stockton’s High Street. She is one of many small retailers worrying about the decline in people visiting the High Street and is having to move premises after a poor year.

“Mentally and physically we are exhausted and pushing to pay our rates,” she says.

“Customers do not want us to close so we are going to become a not-for-profit organisation and community cafe, which caters for people with special diets.”

The Labyrinth has been particularly hard hit after work on Stockton High Street has disrupted transport links, parking and accessibility for more than two years.

Ms Knibbs is concerned that people’s shopping habits will have changed and thinks they will not move back into the town even when it is ready.

MOVING: Deb Knibbs, from The Labyrinth in Stockton High Street, says her business is having to move after a tough year

“Companies are suffering. The town will be fantastic but I worry that no one will come back in after it is finished. The perception is that unfortunately there is nothing here,” she says.

“We just cannot do it anymore. New businesses are getting half price rates for the first two years and we have to pay more in rates than we do in rent.

“We are not looking forward to Christmas but we should be. Last Christmas was virtually a waste of time. We have been forced off the High Street - it is not a case that we would miss the money as we do not have any.”

Although the rate of closures slowed down in the North-East in the first half of this year, more than 120 stores were still forced to close.

Just 92 businesses opened to replace them, research by PricewaterhouseCoopers (PwC) revealed. The biggest hit town was Bishop Auckland where nine shops closed and just three opened.

Allan Kelly, chair of insolvency trade body R3, points to the fact that although the makeup of the High Street has fundamentally changed there is still a dependency on consumer spend.

“The economy is looking brighter generally but when it is retail you have to get the right products at the right time to sell,” he says. “I think you are only going to be successful now if you have a niche store.”

“A lot of companies fail in January and I think it is going to be tough again this year. Part of it will be weather dependent, but it does not help that the sales are starting earlier and earlier.”

Mr Kelly thinks one solution is keeping the High Street varied. “There needs to be some fresh thoughts to bring people back in.”

One initiative that is helping do this is Small Business Saturday, an American concept that celebrates independent retailers. Introduced in 2013, the day aims to persuade customers to visit their local stores.

Nicola Reading, owner of Bliss Gifts, in Darlington, has also noticed a change since she started running the business in 2003 and hopes that Small Business Saturday will help put Darlington town centre back on the map.

“It is not a problem with customer loyalty at all, but a change in spending,” she explained. “Customers are very savvy now and their spending habits have really changed. I think our turnover has dropped by around 20 per cent in the last three years and for a small business that is huge.

“We are trying really hard to get customers through the door – we have just been able to hold on with the tips of our fingers.”

Mrs Reading thinks it is as much a change in habit by the big retailers as with the customers. As giants like John Lewis add more exclusive and diverse ranges to their websites, smaller retailers have been forced out of the picture, unable to compete on price.

“Trying to be exclusive is harder as the big retailers like John Lewis take on more ranges. They get bigger discounts from suppliers as they have multi-outlets,” she says.

“We rely on the customer service element and hope that people do not just want to click a button to purchase Christmas gifts.

“It is a ‘use us or lose us’ mentality and that is one of the most important things about Small Business Saturday. I am so happy to see the big push towards supporting independent retailers this year.”

STRONG BUSINESS: Kenny Walker, of Chocolate Fayre, in Barnard Castle, says his shop is growing every day

When I spoke to Mrs Reading she had had a good trade day with every person who visited the shop buying a gift. But she recognised that times had been, and were going to continue to be, hard. “Since 2011 I consider myself lucky to have a very understanding husband. I have just kept my neck above the drowning line.

“I love my personal business, I am very happy to be here and I am hoping that through such initiatives Darlington will become a vibrant town centre again.”

But not all businesses in the region are in the same position. Kenny Walker and his wife Sarah Wall took over Chocolate Fayre, in Barnard Castle, a year ago. They draw customers in by selling bespoke products and have recently set up a website, which has already seen an order sent to Orkney, a set of islands ten miles off the northern coast of Scotland.

“The products we sell cannot be found on the High Street or in bigger retailers. People come to us from as far as Newcastle and we are very lucky in that respect,” Mr Walker says.

“We have done well and I think there is space for independent retailers and bigger companies on the High Street. We are moving with the current trends but do not feel like we have to do anything more to keep selling.”

Patrick Clarke, of Flat White, Durham, agrees with Mr Walker. He and his friend Peter Anglesea set up the coffee shop in 2010 after converting a former pizza takeaway.

In the last four years the duo has seen it go from strength-to-strength and Mr Clarke thinks people are beginning to realise they need to support smaller retailers.

“We have relished the challenge of setting up an independent business on a High Street full of bigger chains.

“It is a very daunting task to set up your own business. The initial overheads are scary and you have to be 100 per cent sure that you want to do it. The passion is half of the challenge.

“We just try to be better than everyone else. I think schemes such as Small Business Saturday are encouraging as they raise awareness of the importance of supporting small retailers. We can never keep up with Costa or Starbucks because everything is cheaper for them.

“As an independent retailer I would never go to a chain coffee shop – I realise what small businesses have to offer. The staff care more and that really shows.”

Despite the progress Mr Kelly says he cannot be certain the High Street will ever be as great as it once was. “Can you convince the next generation that town centres are worth going to? I’m not sure.”