Monday, 27 June 2011

Footfaller – a regular guest view from the street

The home bakers of Britain are revolting. Fed up with paying £2.50 for a pretty cupcake, which they know they could have made at home for a fraction of the price.

Hello homemade, goodbye cafe-bought.

Its daylight robbery on the high street, and manufacturers such as Renshaw are looking to address this by taking on the American cupcake phenomenon – overpriced, over-iced and over here – through the launch of ranges of ready-made icings.

The new reality of austerity Britain means that nearly 50% of UK consumers now bake at home as it enables them to reduce their shopping bills. Such has been their appetite to don the apron that home baking has been valued at £576 million in 2010 (according to Mintel) and the prediction is that this figure is going only one way.

But the (probably once) humble cupcake, long the preserve of sticky children’s parties, is now all grown up and has become one of the most popular items now baked at home. But something funny is going on though with our reaction to austerity Britain if the Renshaw range is a response to perceived demand.

We want to spend less – that’s a given – but the consumer is not really interested in a second rate cupcake. Oh no. They want exactly the same brightly coloured confection that they’ve seen in the fancy bakers at £2.50 a pop.

Even though we know it’s a sweet mini luxury, which we previously just coughed up for, now we’re not so sure. But we still want that same 'model' in the comfort of our own homes and with all the trimmings.

Coffee shops meanwhile are also facing up to budgeting, but in a more traditional way. They are upping the amount of food in the mix because they are finding increasing resistance to their £2-plus caffeine fixes. When it comes down to it, shoppers are now likely to ditch the luxury of a high-end coffee and buy a sandwich instead.

It's a coffee shop but where's the coffee?

Despite these moves by shoppers to strip out costs, don’t think the move to baking at home is in any way downmarket. The launch of the Renshaw range took place in the sumptuous surroundings of London’s Connaught Hotel where Champagne flowed alongside the icing sugar mixes. Like we said, it’s austerity Britain but not as we know it.

Sunday, 12 June 2011

Leahy departed Tesco prematurely

Despite the well-earned plaudits following his departure last year there is an argument that Sir Terry Leahy, former chief executive of Tesco, was put under pressure to leave earlier than expected.

Sir Terry Leahy: Unfinished business.

The exit came at least two years earlier than originally planned as a result of the failure of a number of strands of his strategy, according to a City analyst who remains bearish on Tesco.

He suggests Leahy would not have chosen that time to leave because the US was still failing badly, the UK was also performing weakly, and some important aspects of the much-vaunted Retail Services division was in its formative stages.

Fresh & Easy: A big pressure point for Tesco.

The US Fresh & Easy business was originally heralded as the 'second engine of growth' at the time of its much-trumpeted launch but it was still underperforming badly when Leahy left - thereby leaving its fate in the hands of new CEO Philip Clarke.

And in the UK, Leahy left without having time to stablise this core part of the Tesco business - despite leveraging double and triple Clubcard points and pushing suppliers to be its chosen partner for launching new products.

The long-standing arrangement had been that Tesco chairman David Reid would leave the Tesco board first and following the appoinment of a replacement Leahy would then follow two years down the line.

Philip Clarke: Does he have the answers Leahy didn't?

However, the issue of the failure of some core aspects of the Tesco strategy may have prompted some disagreements internally, as well as with major investors, which was sufficient for a re-assessment of the departures timetable.

Whatever ultimately happened behind those board room doors Clarke is still very much grappling with the headaches that Leahy faced and it does not look like he has yet found all the answers.

Tuesday, 7 June 2011

Shopping centres thrive while high streets dive

"Sometimes I wonder if the world's so small, that we can never get away from the sprawl. Living in the sprawl, the dead shopping malls rise like mountains beyond mountains and there's no end in sight."

In the same week that Mary Portas was tasked by the government to save the ailing high street, it was announced that Sheffield Meadowhall shopping centre in Yorkshire was to be massively expanded.

More big boxes on the edge-of-town.

While many landlords cannot even fill a few hundred square feet of space on the high street, Meadowhall is set to grow by 700,000 sq ft to a grand total of 2 million sq ft that will make it the largest out-of-town shopping destination in the UK.

Clearly the shopping malls are far from dead (in a trading sense rather than cultural). Further evidence of the life in this retail format came with the confirmation that other firms such as British Land are to kick-start new shopping centre developments for the first time since the recession.

And Cushman & Wakefield has just been engaged to find new tenants for the recently upgraded Mander Centre in Wolverhampton. Agreed, it is far quieter on the development front than it was pre-recession but in comparison with the high street it's positively boom-time.

The number of boarded-up stores littering town centres continues on its upward trajectory in many parts of the country. Many people in the retail industry place the blame firmly with landords for being greedy on rental rates, and at councils for their incoherent local planning activity and onerous parking regimes.

Even the kebab shops and taxi firms have closed in Burnley.

While Retailinsider.com agrees that both parties are at fault, we do not agree with another widely held view that the high street now represents something from a bygone age that has no value in this modern era of shopping.

When on holiday - both in the UK and abroad - part of the experience is to go shopping. And my guess is that this does not involve a car ride out to the shopping malls and big boxes on the edge of towns but to the local high streets.

This is where you get a real flavour of the people and the local community. It's where people engage with each other and shoppers are more likely to encounter a mix of goods from independents and recognised chains.

That many other countries have more vibrant high streets than the UK is frequently put down to the fact that in Britain we have a much more 'sophisticated' retail environment and others have yet to fully catch on to the trend for shopping in out-of-town mega-sized malls.

Whether you like it or not, the parlous state of the high street is supposedly progress.