Convenience Stores Get New Lease of Life: Research Shows That Popular Belief Is Wrong in Forecasting Terminal Decline, Says Prof Neil Wrigley

Article excerpt

Popular belief has it that convenience stores are in a state of decline and that independent stores are vanishing from our high streets. The entry of supermarkets into the convenience sector has come at a time when there are reports the decline is stronger. However, recent research for Tesco by the University of Southampton's GeoData Institute, shows that the convenience store sector has been growing strongly in UK shopping centres in recent years and that new independent stores are responsible for more than half that growth. This article provides a summary of the submission made to the Competition Commission on the back of this research by Professor Neil Wrigley (University of Southampton), Professor Graham Clarke (University of Leeds) and the GeoData Institute (University of Southampton).

In May 2007, the GeoData Institute at the University of Southampton was commissioned by Tesco Plc to undertake an analysis of changes in the structure of the retail landscape in more than 1,000 shopping centres in the UK using the annual/biennial shopping centre plans compiled by Experian Goad.

The work mirrored work by the Competition Commission published in a Working Paper in June 2007. However, the GeoData Institute research refined that work in several ways, most significantly by assessing 'like-for-like' increases and decreases in convenience store numbers, by factoring in changes in the size of shopping centres.

The research showed a dramatic like-for-like increase in convenience store numbers. Between October 2000 and October 2006 the GeoData Institute study revealed a 70.4% rise in the number of convenience stores across the shopping centres studied. The findings corroborate the results of the Competition Commission working paper, confirming significant growth in the convenience-store sector in this large sample of UK shopping centres, indicative perhaps of shifting lifestyles and patterns of consumer behaviour in towns and cities in the UK.

Breaking down these like-for-like changes in convenience store numbers, the GeoData study revealed that most of the increase in convenience store numbers (56.9%) was accounted for by non-affiliated independent retailers. Only 23.8% of the growth in store numbers was accounted for by so-called 'symbol' group retailers and 19.2% came from multiple retailers and cooperatives.

Another interesting facet of the GeoData work was the regional spread of the growth figures. The largest overall increases in convenience-store numbers occurred in London and the South East (56.1%), whilst only 8.7% of the increase in store numbers occurred in the North East, Northern Ireland, Yorkshire & Humberside and Wales combined. The largest percentage growth in independent retailers took place in the North West and London (70%+). …