Retail Change

Contemporary Issues

Rosemary D.F. Bromley, Colin J Thomas

• Publisher: Routledge
• Year: 2002
• Print ISBN: 9781857280593
• eBook ISBN: 9781135371227
• Topic: Physical Sciences
• Subtopic: Geography
• Index: Geography

The economic, social and environmental implications of recent changes in retailing constitute significant contemporary issues, which are the focus of this timely book. Retail change deals with the internationalization of retailing, the development of shopping centres in the city and at suburban sites, and the growth of leisure shopping. It provides an up-to-date review of the central questions faced by undergraduate students in planning, business studies and geography. The retail environment of developed economies has undergone revolutionary change since the 1970s, and the process is far from over. In the book the major elements central to contemporary retail change are developed across the whole spectrum of spatial scales relevant to present-day society. The first part adopts an economic perspective and focuses on the process of business concentration and its increasingly international orientation. This is followed by analyses of change in the urban region, concentrating on the emergence of the great variety of new retail forms associated with retail decentralization. The planning implications of retail change are developed in the third part. The future of the city-centre and other traditional shopping centres is examined in the light of challenges presented by new facilities. Alternative future scenarios contingent upon laisser-faire or interventionist government policy controls are also discussed. The social implications of retail change are developed in the final section. All students and researchers concerned with the evolution and development of the retail sector of advanced economies will welcome this book as an authoritative source of contemporary findings and commentary. Rosemary D. Bromley and Colin J. Thomas are Lecturers in Geography at the University College of Swansea, Wales.. This book is intended for undergraduate students taking courses in economic geography and retailing in departments of geography, business studies, planning, etc.

Part One

The Changing Organization of Retailing

Chapter One

Retail Change and the Issues

Rosemary D.F.Bromley & Colin J.Thomas

Since the early 1970s there has been dramatic change in the retail environment of Western economies. This is of critical importance to both economies and societies, given the growing significance of the retail sector associated with the shift from an industrial to a post-industrial stage. In the UK, 2.1 million people (almost 10 per cent of the labour force) were employed in retail distribution in 1992 (Employment Gazette November 1992) and the largest retailers are now among the largest companies (Lowe & Crewe 1991). In 1991, J.Sainsbury employed about 95,000 people (Sainsbury 1991), while Marks & Spencer employed about 61,000 (Marks & Spencer 1991). In the USA, even larger organizations are commonplace. Wal-Mart, a discount retail chain, was in 1992 reputed to be the largest retailer, with a turnover of $44 billion from 1,700 stores and a workforce in excess of 365,000 (Financial Times, 3 March 1992).

Moreover, retailing exerts considerable influence on the morphology and functioning of Western cities. Retail activities constitute important focal points in the urban fabric, while the emergence of linear and isolated retail developments along major roads are equally significant. The contemporary city is to a substantial degree articulated in relation to retail facilities, and this has important consequences for the nature of city growth and associated opportunities and constraints for urban planning. Shopping trips are also a major component of spatial behaviour in the city, since the vast majority of the population is involved in some direct or indirect way with shopping activities. For most practical purposes, shopping is necessary to obtain the great majority of the goods and services required by modern households. For some, shopping also forms a necessary part of social interaction, while the concept of shopping as an increasingly leisure-based activity has gained widespread acceptance as an important element of popular culture.

The Context of Retail Change

Retail change has occurred in the context of wide-ranging socioeconomic trends. First, increasing affluence has been associated with a rise in car ownership and much greater mobility. Given the improvement in roads, people are now able and willing to travel far greater distances for their shopping and the car is increasingly being regarded by retailers as a “shopping basket on wheels”. However, those who do not own cars have become polarized as a disadvantaged group whose poor mobility constrains their access to urban facilities (Bromley & Thomas 1993). The growth in car ownership and the consequent volume of traffic has also had detrimental effects on movement within the city, and growing central congestion has contributed to decentralization.

A second group of trends springs from considerable changes in the spatial redistribution and composition of population. Counterurbanization, involving the shift towards a less-concentrated pattern of population distribution, in which rural areas and small towns grow faster than large cities, was a dominant feature of the 1970s and 1980s (Champion 1989, 1992). Consumer services such as retailing have followed the population in decentralizing from city centres (Champion & Townsend 1990). Trends in composition have been equally significant. The population is ageing and the proportion of elderly people has increased markedly (Warnes 1989). In 1989, 5 per cent of males and 8 per cent of females were aged 75 or older compared with 3 per cent and 6 per cent, respectively, in 1977 (OPCS 1991:8). Households have shrunk in size, increased in number and become more varied in type (Champion & Townsend 1990). The proportion of one-person households has grown from 17 per cent in 1971 to 25 per cent in 1989 (OPCS 1991:11), a trend in part associated with the increase in the elderly. There are now more households to participate in shopping and more of them are experiencing the restricted mobility associated with the disabilities of age.

A third set of socioeconomic trends result from the changing character of the working population. Part-time employment for both sexes grew considerably in the 1970s and 1980s, and retailing has been prominent in this trend (Townsend 1986, Watson 1992). The proportion of women in the workforce has also increased, and retailing itself shows continued feminization of the workforce, with women comprising about62 per cent of workers (Sparks 1992). Those in work experience time constraints on their shopping patterns, a factor of particular relevance to women, whose traditional gender role has included being the principal shopper (Davies & Bell 1991). However, alongside these trends the growth of unemployment since the 1980s associated with deindustrialization should be noted, and the suggested emergence of an underclass (Eversley 1990). The shopping constraints of disadvantage are a hallmark of the unemployed.

Finally, it is important to be aware of changing social and political attitudes, a topic pursued in Part 4 of this book. Leisure time has increased and people are more conscious of their use of time (Blacksell 1991). For activities such as shopping, the experience either tends towards the leisurely and pleasurable, or the quick and time-efficient. Either way, it is undeniable that retail change is having an impact upon contemporary social interaction. In North America, Hopkins (1991), for example, in a redefinition of “malingering”, introduces the “mallie” as the adolescent habitué of the mall environment. This concept has its counterpart in the family-forming and middle-aged “sheddies” who focus their homefurnishing activities on the retail warehouse concentrations (Brown 1989). Similarly, the British superstore grocery shopper has almost become a cliché of middle-class family normality. During the 1980s environmental concern also emerged as a powerful force, and impinged on many areas of social and economic activity, including retailing. A significant minority of consumers are concerned about the potential global environmental impacts of their patterns of consumption. Issues such as the manufacture and use of artificial fertilizers and their associated pollutant and health effects are relevant in this respect. The burgeoning use of seemingly wasteful packaging has been of similar consequence. Likewise, the origins of imported goods have also generated concerns about possibly exploitative economic and political relationships in the source countries (Gardiner & Sheppard 1989).

While the four groups of socioeconomic trends identified above exert a background influence on retail change, other trends have a more integral role. These include technological change in retail operations, the growing size and internationalization of business organizations, marketing changes, and the weakening of planning constraints.

The technological revolution of the past few decades has transformed retail operations. There has been a change from counter service to self-service, and a huge growth in the size of many types of outlet, particularly in groceries and DIY. Increasingly efficient methods of handling stock and organizing distribution systems have been associated withgrowing economies of scale. Computerized information technology widely introduced in the 1980s has transformed stock control, distribution management and financial control systems (Wrigley 1988). Electronic point-of-sale (EPOS) data capture is now common, providing information for the quick and accurate auditing of sales and stock movements, and saving much staff time in stock control (Johnson 1987a). The EPOS technology can form the basis for sophisticated management information systems, monitoring and directing activities at the sales areas and in the warehouse and distribution networks. Other uses of information technology in retailing include private viewdata systems and remote shopping (Guy 1988a). Although this book does not focus on technological changes, Chapter 9 gives specific attention to electronic home shopping.

The business organization of retailing has also changed dramatically and the associated trends receive particular attention in Part 1 of this book. The small shop has declined at the expense of the large and changes in ownership patterns have led to the emergence of major retail corporations. There has also been a significant transformation in retail marketing and in marketing strategies since the 1960s. The abolition of retail price maintenance in 1964 in the UK, the spread of retailer ownbrands and increased concentration have been associated with the emergence of retailers with greater power and influence than their manufacturing suppliers (McGoldrick 1990, Ford 1991). Retail concentration has therefore emerged as an area of key importance that is itself undergoing considerable change. Competition for market share has intensified, and differentiation and market segmentation have become increasingly pronounced (Johnson 1987b, Ford 1991, Foord et al. 1992). Market segmentation, involving specialist retailing for particular client groups, has altered the ways in which retailers operate. Retailers have both expanded their existing markets and developed new ones. At the same time, the development of single stores selling a wide range of goods, described as scrambled merchandising, has been equally apparent. The expansion of market share associated with retail concentration and the expectation of the investment markets has also resulted in a significant trend towards the internationalization of the activities of the largest retail firms (Treadgold 1990). This is already evident in most parts of the developed world.

Recent retail change has taken place in the context of a free-market ideology (Hague 1991). Thatcherism, dating from the 1979 Conservative election victory, sought to relax the constraints imposed by the planning system in a way that inevitably reduced its scope (Thornley 1990). Following the recession of the late 1970s and early 1980s, the economic recovery, combined with the loosening of planning constraints and administrative fragmentation (Jacobs 1992), contributed to the dramatic restructuring of geographical space. The 1980s has in fact been described as a period of more rapid change in the economic geography of the UK than any other this century (Champion & Townsend 1990). Retailing played a key part in this—compared with the bleaker conditions of the early 1990s (Fyson 1991), the 1980s was a golden age for retailers, when the spatial changes occurring strengthened trends dating back to the 1960s. Perhaps more than any other aspect of retail change, the spatial transformation reflects the complex array of contemporary social, economic, technological and policy trends. For these reasons it merits special attention.

The Spatial Transformation of Retail Structure

Until as recently as the mid–1960s the retail system of British cities had a traditional hierarchical structure. Characteristically, this focused on the central business district, which provided the largest concentration of the most specialized high-order goods and services for the surrounding urban region. This was complemented by a relatively small number of local town centres or district centres offering primarily a strong convenience-goods shopping function and a secondary range of comparison goods for specific sectors of the city. At the lowest level, a large number of small neighbourhood centres and corner shops provided a narrow range of convenience goods for the immediate residential population. From the planning perspective this system was considered capable of providing retail services efficiently for the vast majority of the urban population; it was viewed as a system worth maintaining.

Since the mid–1960s, however, suburbanization and counter-urbanization, increasing affluence, rising levels of car ownership and increased female participation in formal employment have allowed and in some cases necessitated the development of new patterns of shopping behaviour. Combined with the demands of consumers for an increasingly specialized and sophisticated range of goods and services, and associated changes in the economic organization of the retail industry, these changes have instigated a transformation in the character of the urban retail system.

Retailers were quick to recognize the commercial advantages of satisfying changing consumer demand by developing large, easily accessible retail outlets on cheap out-of-centre sites. Thus, despite a strong presumption by most local planning authorities against new forms of retail developments that deviated from the traditional hierarchy (Davies 1984), steady commercial pressure has resulted in the emergence of a number of innovatory forms of retailing in most major cities. Schiller (1986) identifies a number of “waves” of retail innovation that have added new elements to the functional complexity of the retail geography of British cities. These new elements can be categorized broadly into five different types.

• The superstores (2,325–4,650 m², 25,000–50,000 sq ft) were first developed in the mid–1960s and focus primarily on grocery retailing. Development was most active between 1977 and 1990; by the early 1990s, 600 such stores transacted 20 per cent of the British grocery trade (DOE 1992a). Hypermarkets, which were even larger (greater than 4,650 m² or 50,000 sq ft), were also initiated in the late 1960s, with trade almost equally divided between groceries and non-food products. However, few such developments occurred because of the cautious attitude of central and local government planners.
• Retail warehouses (greater than 930 m² or 10,000 sq ft) were developed from the late 1970s, initially selling bulky DIY products from premises deemed too large and functionally unsuitable for locations in the traditional shopping centres. Retailers of electrical goods, furniture and carpets quickly recognized the commercial advantages of cheap, accessible, out-of-centre locations, and many such developments exploited the “bulky product argument” as an exceptional reason for a decentralized site. Subsequently, the array of goods sold in retail warehouses has expanded dramatically and includes car accessories, toys, footwear and clothing.
• Retail warehouse parks consist of concentrations of three or more retail warehouses located along a main road or grouped on industrial estates, either as unplanned agglomerations or, occasionally, forming planned concentrations sharing access roads and parking facilities (Bernard Thorpe & Partners 1985). Where such developments incorporate a superstore, a more balanced shopping facility results, and the term retail park has been used for this variant (Wade 1985). The scale of both types of park varies considerably and some of the largest, such as the Swansea Enterprise Zone retail park (about 37,200 m², 400,000 sq ft), are similar in scale to a small regional shopping centre (Bromley & Thomas 1989). More than 2,000 retail warehouses were trading in 1992 and approximately 250 retail warehouseparks were recognized. Together, they are estimated to transact 14 per cent of retail turnover in the UK (DOE 1992a).
• Subregional shopping centres (18,600–37,200 m², 200,000–400,000 sq ft) typically incorporate a superstore, at least one large non-food retailer and a number of smaller units in an integrated development. The Culverhouse Cross centre on the western edge of Cardiff, which includes a Tesco superstore and a Marks & Spencer store, is a recently completed example.
• Regional shopping centres (greater than 37,200 m² or 400,000 sq ft) are planned as fully integrated, environmentally controlled covered malls. They incorporate department stores, the full range of multiple stores typically represented in a traditional central business district and, in most recent proposals, a significant element of leisure activities. By early 1993 four such centres were trading: the MetroCentre (Gateshead), Merry Hill (Dudley), Meadowhall (Sheffield) and Lakeside (Thurrock). However, a latent demand for many more is suggested by the 57 proposals for centres of up to 139,500 m² (1.5 million sq ft) made during the period 1982–91 (DOE 1992a). The commercial impetus for the decentralization of the wide range of quality comparison-goods retailing that characterizes particularly the latter two categories of developments is considered by Schiller (1986) to date from the proposal by Marks & Spencer in May...

Table of contents

• Cover
• Half Title
• Title Page
• Copyright
• Contents
• Preface
• List of Contributors
• Part One: The changing organization of retailing
• Part Two: Transformation and the urban region
• Part Three: Planning implications of retail change
• Part Four: Social issues of retail change
• References
• Index