Will higher prices continue to keep independent shops down?
Mary Portas launched her report on the state of Britain’s high streets with a bang this week. Its aims are admirable, but how can local shops compete with big chains when price continues to be so important for shoppers?
The Portas Review lays out a number of reasons why the high street and local shops are in decline – shoppers choosing convenience over community, the development of shopping malls into entertainment destinations, and the growth in online shopping.
All of these are valid points, but I think the biggest reason for this decline is that high street and local shops just can’t compete on price.
Swayed by low prices
Our research has consistently found that while price is by no means the only factor in where people decide to shop, it certainly is the biggest one. In our most recent high street shops survey, 47% of respondents named price as the most important factor in deciding where to purchase from.
Which shops are offering the lowest prices? Not independents – they were only rated among the cheapest shops in one of the nine categories (toiletries) in our shops survey. The shops that people rated as the cheapest were mainly chains like Ikea, Richer Sounds, Argos and the ‘big four’ supermarkets – Sainsbury’s, Tesco, Asda and Morrisons.
If those chains are located out of town, they have even more scope to offer lower prices, thanks to lower rental costs. So when bigger stores mean lower prices, and lower prices are what consumers want, what chance do high street local independents have?
I don’t say all this to knock local shops. I’m always dismayed when I see a local shop close down, especially if it’s replaced by another supermarket. I understand the reasons why they find it difficult to compete on price with big chains.
But, while I do use local shops and consider them an important part of the neighbourhood, the fact remains that I do most of my food shopping in Sainsbury’s, Tesco or Morrisons and rely on other large chains for non-food. And as long as they’re cheaper than the independent alternatives, that will probably continue.
Support your local shops – if you can afford it
We want to see good local businesses succeed, which is why we set up Which? Local, a fantastic service to find local traders and shops for Which? members. I’ve personally used it to find a wide range of local services including a chocolatier, a butcher, and a baker (though not a candlestick maker) – and all have been excellent.
The satisfaction I get when I use a good local business always makes me think I should use my local independent shops more – but then those good intentions fade and I’m back in Tesco a few days later, lured in by the low prices.
Do you go out of your way to visit local independent shops? And how much of a factor is price in deciding where to shop?
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