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21/10/2011 13:40

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Small is beautiful in retail as cashstrapped shoppers go local

Small retailers fared far better than bigger stores in September.
With petrol prices so high it seems shoppers are walking to their
town centres and shunning out of town superstores

Royston High Street. Shoppers are walking to local stores rather than driving to big superstores. Photograph: Greg
Balfour Evans/Alamy

Today's retail sales numbers brought only a little respite for Britain's beleaguered
shopkeepers. Sales volume rose in September but over the summer as a whole were
down, while much of the rise in values was attributed to climbing inflation rather than
any pickup in business.
But behind the headline figures there were signs that not all shops are suffering. Nor
are the little stores suffering at the expense of the giants with their big discounts. In
fact, there is a small is beautiful message in today's report.
The Office for National Statistics said sales volumes across all retailers were up 0.6%
in September. Within that, small stores - those with employment of less than 100 fared better than large stores.
Small stores saw sales rise 2.1% on the year compared with a 0.2% rise at large stores.
In other words, small stores grew their sales 10 times faster than large stores.
Perhaps it is no coincidence that at the same time petrol stations saw their sales values
rise 20%, although their volumes rose just 2.8%. Soaring petrol prices account for that
jump in value.
Now with petrol prices high and rising, many shoppers choose to walk to their local
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Small is beautiful in retail as cash-strapped shoppers go local | Business | guardian.co.uk

21/10/2011 13:40

stores for food rather than drive to big supermarkets. That is where small shop success
comes in. There is also a concern among households to avoid wasting money on food
that goes off, says Sarah Cordey, spokeswoman at the British Retail Consortium.
With the cost of fuel, people are sometimes making more trips on foot to
their local town centre and doing more small shops during the week rather
than one big shop where sometimes food gets wasted. Small shops can
sometimes be more responsive to the needs of their customers. This puts
paid to the myth that it's the multiples thriving at the expense of the
smaller retailers.
Scott Corfe, senior economist at Centre for Economics and Business Research says that
at first sight it is "curious" that smaller stores, which are typically less able to offer big
discounts, are doing better while consumers hunt for bargains. But it does chime
somewhat with meetings the thinktank has had with retailers, he adds. There are signs
that smaller stores and those with premium brands, such as Waitrose, are still
attracting customers.
There has been a polarisation. A flight to quality and a flight to value,
rather than clustering in the middle ground. We have been talking to
retailers and they are saying that the tough area is the middle ground,
value and luxury are doing well.
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