It’s procurement not Portas that can save our high streets
First it started sapping the vibe from HMV, then hammering down Focus and now the recession is melting Thorntons from UK high streets. All in all, there is a distinct Dickensian air wafting through our once great shopping streets.
But I’m not ready to give up hope, not one bit. Why? Well, it’s certainly got nothing to do with Mary ‘Queen of Shops’ Portas and her new role as retail adviser to the government. No, I believe that the solution can be found in procurement – or rather joint purchasing among smaller chains or independent entities.
What is killing the high street is the Internet. First, because people can just have what they desire sent to their doorstep all tied up with a nice little bow and second, because online retailers can sell at lower prices as a result of not having any overheads from running such pointless things as shops (note the sarcasm). Even I don’t think procurement can overturn the ease of shopping online, but it could make significant differences when it comes to prices.
This all stems from a story I wrote about Citroën and BMW agreeing to jointly purchase components for their hybrid cars. The key point was that none of the parts were customer facing, so BMWs would still be BMWs and Citroëns would still be Citroëns.
But could this concept be transferred to the retail sector? There may be a marked difference, but I don’t see why not. Independent music stores, for instance, have been hit from two directions. The Internet is the main factor, but the rise of supermarkets as music stores has also had a significant impact.
Supermarkets offer a small selection (the chart top 20 or 30) at low prices because of the amount they order. Independent music stores can’t do this because they are separate entities and buying as a group would defeat the whole object of independence… or would it? Aren’t chart albums the equivalent of hybrid car components?
I believe joint purchasing could have a positive impact on the retail sector, provided it’s used appropriately. I’m no expert, so I’d be really keen to hear your views. Could joint procurement be used by chain stores? Does procurement have the answer to the declining revenues from pubs? Let me know in the comments below.
![[Bloglines]](http://blog.supplymanagement.com/wp-content/plugins/bookmarkify/bloglines.png)
![[del.icio.us]](http://blog.supplymanagement.com/wp-content/plugins/bookmarkify/delicious.png)
![[Digg]](http://blog.supplymanagement.com/wp-content/plugins/bookmarkify/digg.png)
![[Facebook]](http://blog.supplymanagement.com/wp-content/plugins/bookmarkify/facebook.png)
![[Google]](http://blog.supplymanagement.com/wp-content/plugins/bookmarkify/google.png)
![[LinkedIn]](http://blog.supplymanagement.com/wp-content/plugins/bookmarkify/linkedin.png)
![[Twitter]](http://blog.supplymanagement.com/wp-content/plugins/bookmarkify/twitter.png)
This blog seems to miss a very important question – does the high street need saving or do we accept that things have moved on and the large retail chain with a high value property portfolio is becoming a thing of the past and our ‘high streets’ become full of independent niche shops?
I live in a village in Shropshire where our high street is as traditional as they come and have shops that sell things you wouldn’t dream of using the internet to buy, such as 2 butchers, a greengrocers, newsagents, sweet shop, 2 bakers, a general store (DIY, pans, etc.) along with a chemist and several pubs and restaurants.
For me, the idea of a big city high street is somewhere to avoid. We need to embrace the idea of internet shopping as a sustainable method and stop looking to the past. Our high streets have been in decline for the past twenty years – we can’t blame the internet for that. Its evolution, ultimately.
Associated Independent Stores, or AIS, is the largest independent, non-food buying group of its kind in the UK with a combined membership turnover of around £1.8 billion. The group has a membership of 270 independent department store and specialist retailers operating 611 outlets across the UK, Ireland and Channel Islands.
Hi Philip,
I think we’re actually singing from the same hymn sheet. I would welcome retail chains being replaced by niche independently run shops, but if that was to happen then surely those very same shops could use joint procurement to some degree without making them any less independent or niche.
Also, thanks for sharing the information about your high street, it sounds wonderful but as someone who lives in a village with 1 pub, a church and no shops this it sounds like more of a metropolis.
It’s difficult to argue with the conecpt of collaborative sourcing suggested by Adam in his blog. I’m sure there are savings to be made by the independents.
There is something here that smells of a ‘race to the bottom’ though – like there’ll be retail recovery if only prices were lower. I have particular interest in independent record stores (being a complete music nut). Price is important but equally so is the customer experience. I’m old enough to remember the days when record stores had listening booths and staff who were interested and knowledgeable about the music; eager to share that knowledge with browsers and buyers. Sellers and buyers shared enormous enthusiasm.
Slowly but surely this differentiating characteristic was replaced by stack ‘em high HMV and the like, who’s staff often couldn’t give a monkey’s about the actual music.
Once retailers focus on price, the model is too easy to replicate on-line and they’re doomed. If retailers are going to compete with the internet giants, they’re going to have to offer a truly memorable experience to customers so they keep coming back. In terms of record stores, they need to become places where we’d like to hang-out for an hour or two. However, I fear that the horse has bolted and share Philip’s notion that the game may simply have moved on.