High tech high street?

Penrith shopsMary Portas published her report last week to “put the heart back into the centre of our High Streets”. She makes 28 imaginative and wide-ranging recommendations. But her suggestions largely overlook new technology as being part of the solution.

More ‘shops’ than ever before

She writes “new technological developments now mean that the Internet is one of the key threats to retail on our high streets.” We would all agree with that. But it’s also thanks to the internet that the trade of goods locally has never been so buoyant. There have never been so many local ‘shops’ in the history of the British nation. It’s just that most are not located on the high street.

There are over 180,000 registered businesses on eBay typically based in lock up garages, back bedrooms or small units in industrial estates. If we can assume that Mary is looking to improve the fortunes of some 2000 medium to large high streets in the UK then that means that there are 90 such businesses in every conurbation.

That figure doesn’t include at least an equal number of people who are regularly trading but who are not registered with eBay as ‘businesses’. To that we need to add, online businesses that don’t use eBay. So typically there could be 200 ‘outlets’ trading goods in every medium sized town plus the high street shops.

Online businesses can build into flourishing businesses. eBay reports that 159 businesses have topped £1 million turnover, of these 15 are topping £3 million. These are all located in some local community somewhere.

Many online businesses, including my own, are selling overseas too, and are making a useful contribution to our balance of payments. That’s more than can be said of many high street shops.

My suggestions to help our high streets

1  To provide help for the many local eBay and other online businesses to sell locally.

Mary proposes ‘swapshops’ which she describes as ‘a new type of community shop which brings into the real world the skills people have honed online through sites such as eBay’. This is a good idea but it would seem to go only a small way to meeting the likely demand.

She also proposes a ‘national market day’ to give anyone a taste of market selling. But regular market trading does not help the couple who have built a useful secondary business online, but work full time in day jobs. Many people do this at car boot sales anyway. Instead, regular weekend indoor stall trading days in the town centre might prove popular.

2  The use of QR codes to sell goods. Perhaps the local online shop goods could be displayed, either physically or on posters, and sold by scanning QR codes into a smart phone. Maybe a touch screen computer could be available for people who don’t have smart phones so that they can also order the items. Large retailers such as House of Fraser, Tesco, Marks & Spencer and eBay are experimenting with this method of selling.

3  Portas also suggests a ‘Virtual high street’, a web portal that would show you all the offers across all high street shops. But other SMEs, not in the high street, should be a part of this too. Multiple shop portals were tried in the early days but generally were found to be not very successful.

4  The financial model of a small high street shop is changing. In future, most will either have to sell very high value goods successfully or sell online as well. A classic example is the tiny International Magic Shop in Clerkenwell Road which also trades as international magic.com. A shop with a small footprint is otherwise going to become increasingly less viable.

High street shops need a financial incentive (perhaps paid for by a one-off business rate incentive cut) to create a virtual presence. Perhaps they might need some local expert web ‘hand-holding’ to get started.

5   We need to persuade online businesses to open high street shops, colloquially known as ‘clicks to bricks’. There are many examples of this across the UK. Perhaps waiving business rates for two years would persuade successful online traders to create a high street presence.

6  Insist that all local authorities accept advertising on their websites to help all local businesses. The idea that councils must be seen to be impartial is simply hypocritical as all councils accept advertising or sponsorship in one form or another … eg roundabout sponsorship, venue hire, lamp post and vehicle advertising, printed advertising, etc).

I think Mary Portas has made a great start and everyone must be willing her on to save our high streets. But an unlikely saviour might also be one of the contributory factors in its demise.