Consumption trumps consumerism for high street entrepreneurs

Independent and start-up hospitality businesses, such as restaurants, pubs and cafes, are trumping independent retail stores on the high street, according to research by Simply Business, the largest business insurance provider in the UK. A study of 75,000high street businesses quoted by Simply Business since 2008 shows that last year 31 per cent were restaurants, pubs or cafes, an increase of two per cent since 2008.

In contrast, the number of independent clothes shops has declined, making up only five per cent of high street businesses in 2010, compared to six per cent two years ago. The results suggest that independent fashion retailers are struggling to compete with the big high street chains and the increasing number of shopping malls, such as Westfield in London and the Bullring development in Birmingham.

Independent newsagents are also struggling according to Simply Business, with the proportion of shops having halved between 2008 and 2010. The decrease suggests that traditional corner shops are finding it hard to compete with the proliferation of local supermarket chains on Britain’s high streets. Tesco, for example, is due to open 292 more stores this year alone.

Jason Stockwood, CEO at Simply Business, commented: “The business climate has clearly been more favourable for some retail businesses than others and this has influenced the make-up of high streets across the UK. While it’s great that food and drink businesses are doing well, it’s worrying to see that certain sectors such as fashion and newsagents are in the decline, with competition from the big high street brands a likely cause.

The findings are timely given the recently announced review into the decline of the high street headed by ‘Queen of Shops’, Mary Portas. Portas aims to reduce the number of “clone towns” and increase diversity in town centres, with fewer big chains and more independent businesses.

“With the Government currently focused on increasing the number and diversity of independent retailers in Britain’s towns, it’s crucial that start-ups don’t fall at the first hurdle and have every opportunity to compete with the big boys,” continues Stockwood. “This means favourable planning laws, affordable business rates and easily accessible advice, support and finance.”

Two success stories however are hairdressers and beauty salons, showing that high street chains haven’t had such a large impact when it comes to personal grooming. The proportion of hairdressers has increased from four to five per cent since 2008 and the proportion of beauty salons from two to three per cent.

Figures highlight some regional high street hot spots

  • Wales is the place to go for a drink – 17 per cent of high street businesses in the area are pubs or bars, two per cent higher than the national average.

  • Predictably, London is the restaurant capital of the UK - 11 per cent of high street businesses are restaurants, a massive five per cent higher than the national average.

  • Scotland is the place to go for a haircut, as seven per cent of all outlets are hairdressers. That’s two per cent higher than the national average.

  • South West, Wales and the North East are top for a caffeine hit, with 12 per cent of shops taken up by cafes or coffee shops, one per cent higher than the average.

  • Two per cent of high street shops in the South East are florists, one per cent higher than the average.

  • London is the independent fashion capital with the highest proportion of clothes shops – six per cent compared to five per cent nationally.

  • Scotland is also top for takeaways - six per cent compared to five per cent nationally.

For further information, or to arrange an interview please contact:

Sophie Howard
020 7009 3128
Simplybusiness@3-monkeys.co.uk

About Simply Business

Simply Business is the UK’s biggest business insurance provider.

Launched in 2005, Simply Business provides an online brokerage service delivering policies tailored to individual business requirements. It has a team of UK based insurance specialists and employs almost 300 people across offices in London and Northampton.

Simply Business provides insurance to over 350,000 UK SMEs and landlords and owing to its internal underwriting capability can cover over 1,000 trade types. It has been a Sunday Times Tech Track 100 company for the past three years and was recently named in the Deloitte Technology Fast 500 EMEA. Revenues have grown from £4.2 million in 2006, to £25.4 million in 2014, and the company has been named 2015 and 2016 winners of The Sunday Times’ Best Company To Work For.