Out of town retailing is a lifestyle issue, saving time and money for some, while being out of reach of others. It is also big business, with retail giant Wal-Mart one of the main players. But what effect do such stores have on the local area? And do consumers choose to shop there, or do they simply have no choice? Bernice Hurst reports.
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Out of town retailing is a lifestyle issue. It is a destination activity; a one stop shopping experience for the family to share during its restricted and tightly controlled leisure time. It panders to necessity more than pleasure and callously discriminates against those without a car or the wherewithal to bulk buy.
Out of town locations by definition exclude shoppers who do not own cars. Although this is less applicable in the United States where few such people exist, it is not unusual in the United Kingdom, especially for city dwellers. Those on low incomes also lack the means to take advantage of supermarket bulk buys; they simply cannot afford economies of scale. Nor do they have the space in their crowded accommodation to store multi-packs, which attract the biggest discounts.
Out of town retailing can also be viewed as one of the factors that shape communities. It defines our need for cars, reasonable petrol prices, wide roads with convenient access and locations accessible to homes. Malls and shopping centres can be the first buildings erected in an area targeted for new development. They can include health centres and banks, newsagents, travel agents, dry cleaners, post offices and all the other services that used to be located in town centres that are now either deserted or wall-to-wall pubs and clubs. They inevitably include assorted places to eat, ranging from fastfood to casual dining with enough choices to satisfy the whole family.
Out of town retailing does not just supply demand, it creates it. Chief amongst its temptations are convenience and value, the latterdefined as low prices and bargains. But one element of the vicious cycle of out of town shopping is that it does not actually offer either bargains or value across the board.
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By GlobalDataBack in December 2002, the New Economics Foundation (NEF) published its report on Ghost Town Britain, spelling out both the economic and social implications of continuing to rely on out of town shopping. Some of its predictions have come to pass but many people have taken note and are trying to find the means of change.
Other countries, too, have initially welcomed superstores and hypermarkets with open arms. But the inexorable march of the same companies so entrenched in the UK and US have also lead to planning restrictions in terms of size. Protests and backlashes may not yet be as deafening but with the same policies and the same products to be found all over the globe, the same responses from customers should not be totally unexpected.
Distance makes the heart grow fonder
Out of town locations, which require deliberate choices and efforts about where to shop, annihilate competition. Competition, and ensuring its continuation, was a primary consideration for the British Competition Commission when deciding who would be permitted to buy Safeway in 2003.
But out of town locations can control competition. No problems with customers walking up and down the high street comparing prices and cherry picking. You can offer value on some items while compensating with higher margins on others.
Supermarkets need critical mass in order to make profits. What better way to achieve sufficient footfall than to have a purpose-built, conveniently located venue with no distractions other than more (non-competitive) shops?
Internecine warfare
Many new homes in the UK are being built without car parking spaces at the same time that town centres are restricting the size of shops. Meanwhile, newly approved out of town developments may struggle for customers who appreciate having big car parks at the stores but wish they had somewhere to park when they got their purchases home.
Deputy prime minister John Prescott says that the UK needs thousands of new homes, preferably located in communities offering shops and services to meet all the needs of all the people. The relaxation of planning regulations and announcements of new housing will create new target markets giving fresh impetus to out of town developments.
Questions about chickens and eggs could even be asked; if there needs to be growth in housing over the coming decades, commensurate facilities and services will be necessary. Out of town retail developments can be seen as a precursor to new communities that will need roads and houses, schools and health centres, and other services. They can be seen as providing an essential infrastructure which is conveniently in place prior to foundations being laid for the first new houses. And residents won’t need cars to get to them. Perhaps there is a master plan after all.
In spite of the frequent assertion that consumers vote with their feet, more and more communities are trying to prevent the opening of large format stores rather than waiting for them to be built and then refusing to be lured through their doors. Using the fact that the shops are busy and profitable as proof that customers want and need them ignores the fact that there is little, if any, alternative.
Stopping development has not proved to be straightforward or even feasible. On both sides of the Atlantic, retailers are using both stick and carrot to open in the locations of their choice rather than the locations to which they have been invited by under-served consumers. One stick is that of money. After an initial protest, local groups are often forced to give up the fight on the grounds that they cannot afford the legal costs they would incur by continuing to resist.
Contributing to community life
The four-month-long strike in Southern California produced hundreds of thousands of words of analysis and commentary. Superficially triggered by employers’ demands for reductions in wages and healthcare benefits, its underlying cause was Wal-Mart’s expansion plans. Worried about an inability to compete on price, supermarkets decided that reducing outgoings, such as employee costs, would be the road to salvation. Not surprisingly, employees and their unions did not concur.
The entire state of Vermont has been declared a heritage area to try and control where superstores are opened; they will be invited into locations that communities deem acceptable. There is still an argument over who makes the decision. Supermarkets claim they exist to meet consumer demand but also spend vast sums of money trying to find a way into locations that they have defined as being under-served
Plaintive wails are emitted from supermarkets insisting that they respond to consumer demand. Asda’s chief executive, Tony DeNunzio, maintains that his company’s shops make a “tremendous contribution to local communities, providing the funds to transform difficult sites and offering a tremendous boost to town and district centres,” according to Julia Finch, city editor of The Guardian.
Meanwhile, parent company Wal-Mart has indicated that it will spend whatever it takes to overcome objections and referenda precluding big box stores from opening in neighbourhoods where residents and local officials prefer life without them. In cases such as those, the response is that a minority is dictating to the majority, imposing their whims against the will of those who could provide what is good for them. Did someone out there whisper “nanny corporations”?
