Over the past decade there has been a steady fall in high street shopping which has been felt by both large chains and small independents. The initial uncertainty was put down to the financial crisis around 2007 / 2008 which led to the credit crunch with many speculating that things would improve.
However a decade on and the decline in high street shopping has continued with the likelihood of recovery being slim. Whilst many continue to speculate over the cause of the decline it appears that it’s all due to a culmination of factors which have coincided with the impact of the financial crisis a decade ago.
It is clear to see that the footfall present on our high streets is significantly lower than it was 20 years ago. The most affected businesses are those in the retail sector, with the sale of products opposed to services finding the current times the most challenging.
The increase in online shopping
Many believe the major factor causing the decline of people shopping on the high street is the rise in online shopping. Clearly in the past decade technology has improved significantly to enable easy and convenient shopping not just from the comfort of your own home but also whilst on the move. Many companies have embraced this technology with companies such as Amazon offering significant advantages over shopping in town. With the majority of mobile phones now being smart phones allowing continuous internet access through 4G and WiFi hotspots shoppers are able to make a purchase quicker than it takes to travel to the shop.
Having hundreds if not thousands of different websites selling the products you want gives way to increase in choice as well as the ability to purchase at a much lower price. Local independent retailers would struggle to maintain such large amounts of stock.
In the past the high street retailers would have the advantage of the products being available that day, however as delivery times and prices fall and most online retailers offering next day delivery the gap narrows on this advantage.
High street shop overheads
Possibly one of the most crippling factors of any high street shop is the overhead costs. If renting a premise then most landlords demand hefty rates and unsurprisingly these rates have not declined in line with the footfall traffic present. As landlords slowly struggle to fill shop space they will begin to find that their investment is not paying off as planned and will likely increase rents to compensate the lack of demand.
Its not just the rental costs, its also business rates, utility costs such as water and electric and general running costs including staff. Whilst an online retailer may have similar outgoings these can be significantly less than those of someone on the high street.
Changes to social and community behavior
An underlining factor to how we shop goes hand in hand with our social behaviour. The improvements in technology has increased in our reliance of it, with it now being socially acceptable to stand in a room whilst staring at a screen opposed to engaging in conversation. As we detract from human interaction we become desensitised to the social element of shopping. It therefore becomes a chore to travel to a shop or number of shops and the convenience of tapping on a phone then seriously out ways going to a physical shop.
In many local communities the high street used to be the hub of the community, however with most people now working longer hours and then wanting to spend what ever time they have with their family, less time is available to spend in town and subsequently contributing towards the local community. With budgets being squeezed local councillors struggle to maintain services and provide solutions in particular to the demise of the high streets. Trying to find a one size fits all solution is futile as the issues are seemingly multilayered, with the most difficult challenge in being changing social factors and community perception which is intangible.
The Future of the High Street
We can of course only speculate on the future of the high street, however it can already been seen that the businesses that are likely to survive are those that offer a service which is difficult to replicate online such as coffee shops and hair dressers. Whilst off licences and bookmakers still appear on the high streets, it’s possible that over time online providers will take the market.
Clothing retailers will continue to decline to a few specialist outlets and the large malls. Some independent retailers of specialised niches will continue in selected areas until the overheads out way the revenue.
What’s your thoughts on high street shopping? Feel free to leave a comment below.