Archive for the ‘Retail’ Category

Retail property law: the retailer is dead… long live the retailer

The retailer is dead… or is it?

We still need to buy things – food, drink, clothes, furniture… And we still want to buy things – coffee, cake, books, technology. What has changed, of course, is our ability to now buy things from the comfort of our homes, without needing to head out into the cold. As legal advisers covering retail property law,we believe we are well placed to understand the challenges retailers are currently facing.

So what do retailers need to do to get us out of the house and into their shops? This is one of the questions Mary Portas was tasked with when David Cameron asked her to undertake her review into the high street, back in 2011.

Portas’ recommendations in her report, The Portas Review focused upon retailers (as expected) and her suggestions revolved around helping independent retailers by cutting red tape, introducing flexibility around rates, disincentivising landlords from holding onto empty properties, creating strong leadership at council level, and free parking.

And the so-called ‘Portas Pilots’, twelve towns given a share of £1.2m, government support and access to Mary Portas have not quite delivered what was hoped, with almost 1,000 shops closing between 2012 and 2017, a drop of 17%. Even Portas herself has criticised the project as a ‘weighted PR campaign’ and complained it had failed to kickstart growth.

And what many commentators now accept as received wisdom is that instead of pure retail, the high street needs to transform into a leisure and entertainment destination – somewhere we can spend money not on essentials, but on experiences. And looking beyond the high streets, to some of the UK’s most successful town and out-of-town centres, this is exactly what is happening. The majority of shopping centres now blend retail units with food and drink outlets, either providing complementary offerings away from the more traditional ‘food hall’ experience, or losing the food hall entirely.

The bigger shopping centres have, of course, always blended entertainments with shopping – for example placing cinemas, bowling alleys or even, in the case of the Metro Centre in Newcastle-Upon-Tyne, a fun fair, at the heart of the action. And now others operating on the high street are starting to see similar moves. The Altrincham food market is a great example of independent retailers coming together to create an experience, a ‘sticky’ concept that keeps people on that particular high street for as long as possible; encouraging them to spend upon the enjoyable experience of good food and drink, and ideally also persuading them to purchase food and goods to take back home.

In addition to experiences, or perhaps complementary to, there is still a need for shops that people want to visit, to buy products they perhaps can’t buy online, or that they want to see in real life. Commodity goods are so easily purchased online, but hand-crafted, individual, bespoke or rare items can translate into ringing cash tills on the ground, as long as there are other complementary shops and entertainments in the locality to attract customers in the first place.

So, recognising the changes afoot, what can be done to help out high streets? Here at Ratio Law we obviously don’t have the same budget and insight as Mary Portas, but we do have many years’ experience in retail property law, helping retailers with their property requirements. Our recommendations are:

1. Increase flexibility.

The typical high street’s requirement for retail units has declined. Within minimal bureaucracy allow buildings to be repurposed for offices and residential developments; people living close to nice shops will be inclined to use them.

2. Review rates changes.

In 2017 the government revalued property for the first time in 7 years. And whilst this reduced rates for many retailers outside of the major retail centres, those with larger retail units in the busiest areas faced large hikes as a result. Ironically one of the major beneficiaries of the move was online retailers, who tend to locate their warehousing units away from the major centres. If the government truly wants to support the high street, it may now need to review its treatment of the online giants vs traditional high street retailers.

3. Devolve powers.

Local councils need to be given the power to self-determine and be creative in their partnerships with business leaders, landlords and business people. Give them the ability to develop retail and entertainment destinations and match ability with funding.

4. Encourage local entrepreneurs.

Anybody taking a risk and setting up a business that could benefit the local high street should be supported, and their exposure to risk minimised. Support could include seed funding, mentorship or reduced rents or rates.

5. Accept this is a period of re-adjustment.

One thing that strikes us is that things are always changing, and that the experiences we are going through with regards to the high street are simply indicative of the moving requirements of the public. The high street will never truly ‘die’, it will simply change, as it has changed many times in the past. There will be winners and losers, but ultimately the next few years will lay the groundwork for a new, hopefully improved high street experience for retailers and the public alike.

Retail property law experts: Ratio Law

Here at Ratio Law we have extensive retail property law expertise, with many years’ experience providing strategic legal service to retailers looking to relocate, enter new premises, expand or re-negotiate – we manage complicated legal transactions relating to retail property including conveyances and leases. We are experts in retail property law, having worked with retailers Bench, The RealBuzz and many more over the course of the past 20 years.

If you are a retailer requiring commercial property advice, get in touch with Ratio Law partner Joanna Norris for an initial chat on joanna.norris@ratiolaw.co.uk or 0161 464 9543.

The RealBuzz Group appoints Ratio Law…

The RealBuzz Group has appointed Ratio Law!

Exciting news here at Ratio Law, where we are excited to announce our appointment by The RealBuzz Group. We will be responsible for managing property transactions for the UK retail arm of the industry leading tech-retail provider in the active endurance sector. The appointment comes as the business seeks to grow its sports and leisure retail offer through bricks and mortar shops across the UK, aiming to capitalise upon the brand’s strong web and social media following.

Our retail property expert, and lead partner for The RealBuzz Joanna Norris commented: “We are very excited to announce our work with RealBuzz, a company that leads the way as a new type of retailer; focussed entirely upon what the customer wants, and providing a seamless on- and off-line service that meets and exceeds expectations.

“We will be supporting the business as it expands its reach throughout the region and further afield, and look forward to continuing to provide outstanding support and assistance in this respect.”

Mark Brownhill, Head of Retail Operation at The RealBuzz Group added: “We needed a law firm that could help us to quickly and efficiently carry out the legals required for us to enter new destinations – we aim to open 45 stores by the end of 2019, and 70 by the end of 2021. With its focus upon providing a partner-led, cost-conscious service, Ratio Law was our natural choice. We look forward to our continued partnership as we grow our retail network across the UK.”

If you would like to know more about our retail property work, please give us a call on: 0161 464 9540 or speak directly to Joanna on: 0161 464 9543 or via email: joanna.norris@ratiolaw.co.uk

Happy Birthday to us!

By Gisella Alberici

We’ve been celebrating in the office this January as Ratio Law has turned five!

It feels like only yesterday when myself, Joanna Norris and Stuart Stones started talking about setting up the firm. We all wanted to offer a genuinely different type of legal service to our clients; we wanted to be able to deliver first-rate legal advice and business support on a one-to-one basis. By working in this way, we believed we’d be able to make a real impact on our clients’ businesses by becoming an extension of their team and delivering a truly bespoke service.

This ethos has been integral to how we run our business and key to our success over the last five years. We’re committed to staying true to our roots and will continue to work in this way as we move the firm forward over the coming years.

In 2013, we moved into our new office in Hanover House in Manchester city centre. A couple of years in and it definitely feels like home. Looking around the office, it’s hard to believe we now have a team of 9 people – a number that is sure to increase this year as we look to expand further into our areas of specialisms, especially property finance.

Starting and growing any new business presents challenges, but thanks to our fantastic team and clients we’ve been able to build a law firm which we are truly proud of. We’d like to thank everyone for all their support over the last five years and raise a toast to the next five years and beyond.

How retail needs to evolve to survive

By Ratio Law’s Joanna Norris

Just as it appears that market conditions are improving for businesses across the board, there is yet another report about how the retail sector is lagging. A recent paper by Centre for Retail Research predicts that by 2018, the total number of shops in the UK will decrease by 22% with a further 164 major or medium-sized companies likely to face administration, meaning a loss of some 22,600 stores and 140,000 jobs.

It’s long been agreed that the rise of internet shopping has played a huge part in the demise of the high street, but what can bricks and mortar retailers do to not only survive, but thrive?

1: Make it easier for the customer: One of the perks of online shopping is the ability to buy anything, at any time and get it delivered anywhere (all within reason, of course). We’re living increasingly busy lives, meaning many people simply don’t have the time to go to the shops and wander around aimlessly, before leaving empty handed because they can’t find what they want.

But while online shopping allows customers to buy virtually anything quickly and easily, there are often issues when it comes to receiving the goods. A survey by Which? found more than 60 per cent of consumers have faced delivery problems when receiving an online purchase. Whether it’s because people get fed up of coming home to a doormat full of ‘sorry we missed you’ cards, or their workplace has clamped down on getting personal parcels delivered to the office, consumers want more control and flexibility when it comes to accessing their purchases.

This is why services like Click and Collect have soared in popularity over the last couple of years. And it’s not just a service that traditional bricks & mortars are offering, online retailers are getting in on the action too. For example, Amazon has placed lockers in a number of retail units across the country, enabling customers to collect their purchases at a time and location that suits them.

Although Click and Collect services provide increased convenience for consumers, they are not a panacea and there are a number of potential issues retailers need to consider if they decide to provide access to the service. For example, do they have the space available not only to hold the stock, but to also cater for the number of customers coming to collect items? Is it a service that they can offer out of normal trading hours? In addition, how can they ensure that restricted goods such as alcohol, tobacco and knives, are sold only to the appropriate age group?

2. Relax Sunday trading rules: Following on from the theme of making it easier for the customer, relaxing Sunday trading rules is one possible solution that many businesses would like to see implemented. Currently, retailers are only allowed to trade for six hours on a Sunday, between 10am and 6pm. However, smaller stores of less than 3,000 sq ft are able to open for longer.

The restrictions were suspended during the Olympics and Paralympics, and many retailers now want them to be lifted all together. While supporters of the idea believe it will provide more convenience for consumers, boost spending and increase job opportunities, critics worry it will harm smaller retailers and that it could have an adverse effect on British traditions.

3. Rethink the purpose of the store: Although more and more people are purchasing goods online, many consumers still like to go into an actual shop and see or try the products in real life. Many retailers have noticed a trend for ‘showrooming’, that is going to look at a product in a store but then buying it at a lower price online. While this practice can be damaging to smaller retailers who lose out to the bigger companies who can beat them on cost online, some retailers are recognising this is a trend they can take advantage of.

As a result, it may not be long until we start seeing traditional bricks and mortar stores as ‘retail destinations’ where consumers can go and view a few samples – which they can touch and feel, rather than simply a place where they go and purchase goods. Retailers who evolve in this way may well start to exploit technology, such as interactive screens, to help immerse consumers into the brand as well.

If this trend takes off, we could well see the look of the high street change. Large premises may be turned into smaller, independent units, or bigger spaces may take on more of a department store feel through smaller concession retailers. Of course, if retail units are adapted for viewing, as opposed to buying, the existing trading laws may not apply or require adaptation to support these changes.

What do you think – are there ways that retailers can adapt to survive on the high street?

Top Tips for Retailers: Surviving and Thriving in the Festive Season

Ho ho ho… Christmas is here… nearly. But what should be a time of fun for all, and seasons greetings, can sometimes turn into a nightmare of Ebenezer Scrooge proportions for retailers that aren’t well prepared for what’s to come.

So, what can retailers do to ensure everything runs as smoothly as a sleigh on snow and make this one a Christmas to remember – for all the right reasons… Jo’s top tips follow:

1. Keep an eye on your cashflow

Many retailers will have rent due on Christmas Day, so ensure you plan for this and have the cash ready and waiting in your account.

You may also have paid up-front for your seasonal stock, or you may be sitting on invoices – either way – cash will have left or will be leaving the business, so you need to ensure you have enough in the bank to meet your usual expenses plus…

2. Staff

If you’re expecting a bumper Christmas period, you’ll need to think about who will be manning the tills, keeping the shelves stacked, or if you are entirely or partially online, who will be getting those parcels out of the door in time. Don’t forget to budget for temporary staff, and, if relevant double-time for those last minute late shifts or bank holiday hours.

Plan ahead to ensure you have enough support, and don’t forget to put contingencies in place to ensure you’re covered for outbreaks of flu and lateness or absence due to bad weather.

3. Opening hours

Think about whether you’ll remain open over the Christmas period, or close until the new year. You know your customers better than anyone, so you should be able to gauge whether they’ll be queuing up on Boxing Day, or avoiding the shops until the new year in favour of a Homeland box-set, tin of Quality Street and a glass of Baileys.

4. Flog it!

It goes without saying that you will have invested heavily in stock in readiness for the festive season. Depending upon the nature of your retail business, this may be seasonal, perishable or simply this year’s ‘big thing’. Whatever it is, you’ll need to shift as much of it as possible before the doors close on Christmas Eve.

If you find you’re selling less than you’d expected, it’s worth thinking about some clever marketing initiatives to pull in those last minute Christmas shoppers – exclusive discounts, limited period sales, social media promotions or competitions can all help to promote sales.

5. Christmas-up your shop window

You don’t have to be Selfridges, John Lewis or Harvey Nichols to unveil a wonderful Christmas window, and nor do you have to have even trade from a physical shop. But regardless of where and how you trade, think about how you promote your goods and try to inject a little festive excitement into your window display or across your website. It could make the world of difference!

If you need advice on any retail or property matter, please contact our specialist retail partner Joanna Norris on 0161 464 9540, or by email: joanna.norris@ratiolaw.co.uk.

The High Street or Retail Park: Choosing the Best Retail Location

In this post we pose the question; which is the best location for today’s retailers to do business – on the high street, or in a retail park?

Traditionally; retail parks were dominated by retailers of white goods, furniture and DIY items. However, in recent years there’s been a sea change, with ‘softer’ retailers such as Boots, Next and even banks such as Metro Bank moving in.

Added to this new type of retailer, the ‘leisure’ crowd have also taken a piece of the action, with cinemas, bowling alleys and restaurants fast becoming synonymous with out-of-town locations.

So which is better – the high street or the retail park?

Some retailers choose maintain a presence in both, for example – as already mentioned – Boots and Next. Others have very clearly defined parameters when it comes to store locations. Primark, for example, has just one retail park shop in Milton Keynes, and recently confirmed it would not expand into any other out-of-town locations.

Retail parks can offer convenience, free parking and those with a leisure element, a meal, movie or afternoon of bowling. Many are also home to a wide range of different retailers, and often provide the convenience element of an on-site or nearby supermarket.

In terms of benefits for retailers, these tend to include flexibility of space available, free parking for customers, and often a wide variety of complementary stores – which can help to draw the crowds. Of most importance for many portfolio managers is, of course, cost. Retail park rents are still typically lower than town centre properties, although the very popular centres sometimes buck this trend.

On the flip side, retail parks may struggle to attract the same levels of passing trade that high street retailers benefit from. Additionally, without the ‘draw’ of a heavyweight or flagship retailer such as House of Fraser or Marks and Spencer, retail parks can fall out of favour with shoppers. This can lead to a downward cycle with retailers moving out, and portfolio managers struggling to attract replacement tenants.

Although the high street has been described variously as ‘dying’, ‘on its last legs’ and ‘in need of help’, it has thus far refused to roll over and die. The benefits of the high street for retailers are varied. From a location perspective; high streets are often convenient for workers popping out for lunch or after work. British town centres also tend to be well served by public transport, although parking availability and costs may provide a hurdle when it comes to encouraging shoppers to visit from further afield.

Tourist attractions such as historical buildings, museums and art galleries should not be forgotten. These are commonly located centrally and attract tourists in their own right. Of course, these travellers can also be tempted into visiting nearby retailers.

In addition, the high street is also typically the home of the independent outlet; shops of course, but also restaurants and coffee shops, which remain attractive to a certain kind of shopper.

Finally, it’s important to consider the social aspect of shopping; that is an hour or two spent in the shops, and then lunch or even mid-afternoon cocktails. Whilst many retail parks have aped the retail/leisure mix often found on the high street, many shoppers continue to choose the high streets of Britain as their ultimate shopping and entertainment destination.

In essence, retail parks and high street locations offer different benefits and challenges alike for retailers. Existing or wannabe retailers should take careful note of these when making decisions about location, and must be careful not to rush into long and expensive leases before carrying out a detailed analysis of the pros and cons associated with both.

For information and advice on retail law, landlord and tenant law and property law matters, please contact Joanna Norris on 0161 464 9540, or by email: joanna.norris@ratiolaw.co.uk.