I’ll be at this week’s Scotland’s Towns Partnership conference in Kirkcaldy. It promises to be a good gathering of like-minded folk from across the country – following from the first ever World Towns Leadership Summit in Edinburgh this summer.
STP says “great challenges remain for Scotland’s diverse towns” and highlights the need for towns to utilise partnerships and innovation. In particular, towns are asked to explore “opportunities offered by new developments in the digital, creative, housing and planning spheres“.
In the same week, two pieces of news have hit home: first, M&S are planning store closures. In July, the group posted its worst quarterly sales figures for a decade. This week – an 88% fall in half-year profits. The result? Smaller branches in what they perceive as weaker towns are expected to bear the brunt. Second, Retail Week has published the results of a survey that shows a major mismatch between customer and retailer expectations over Black Friday.
Putting the whys and wherefores of Black Friday to one side, the mismatch is not just a gap … it is a chasm. Versus last year, 90% of retailers expect us to spend either the same or more. These are the major players … 20 multiples who account for almost half of all the UK’s retail sector turnover. They should know their stuff.
The customer? We beg to differ: 74% say less. Only 14% expect to splash more cash. Is it any wonder the more traditional high street multiples continue to struggle? I like surveys. Polls have had a rough ride over recent years when it comes to politics, but folk ask questions of customers all too infrequently. The customer knows: always has … always will.
Back to Kirkcaldy – the home of Adam Smith. The conference is being held in the theatre that bears his name. Some 240 years ago, Smith wrote of ‘the invisible hand’ … the unseen forces that balance supply and demand in a free market. He also wrote of the division of labour. His arguments predicted our country’s industrial evolution and our ability to undersell and out-produce all of our competitors. In his day, Kirkcaldy built ships, made pins and nails … and was a successful port.
Roll the clock forward to another economist – former Kirkcaldy MP, Gordon Brown. His book, ‘My Scotland, Our Britain’ spoke of his ancestors’ pre-industrial work, primarily employed on the land and moving from farm to farm to find jobs. Many hark back to what is seen as Kirkcaldy’s heyday when coalmines surrounded the town. Just before the Great War, mining employed close to 30,000 men in the county, producing close to 10 million tons of the black stuff.
But before the mines came linoleum and canvas: before the canvas and the queer-like smell? It was pottery, flax and linen weaving that made the town tick. Kirkcaldy has always evolved. Places do. Just last year, the credit data group Experian published a study highlighting Kirkcaldy as the home to Britain’s best-performing micro-businesses (those with a turnover below ??100,000). It outperformed everywhere. Those businesses are clearly listening to their customers.
And yet the headlines often do Kirkcaldy down, especially when it comes to the high street and retail. The closures of among others McDonalds & Tesco were seen by some as the death knell. The high street is the town’s face; it bears its scars for all to see … but the closure of national retailers should not be seen in such a way, especially when they fail to consult with their customers.
Tesco closed in 2015 and cost 180 jobs. In the same year, two men opened a coffee shop on the high street in the premises that had remained empty since McDonald’s shut in 2011. The enterprising duo had been running a mobile coffee shop in the town for a couple of years. Their customers loved what they did – so they took the plunge and opened the Cupcake Coffee Box. Two years on, listening to their customers, the company employs a dozen people and has recently expanded to open an ice cream parlour. OK, that’s not replaced Tesco … but other small independents are investing too. They believe in their town. Tesco – and others – do not.
The town’s Business Improvement District has been fundamental in helping to create an environment where businesses can start up. The BID can do little to affect closures: that buck stops at the local authority’s door and has more to do with business rates and a disproportionate focus on out of town development … still.
I wonder what Adam Smith would make of today’s town? I think he’d love the news on micro-businesses and feel sure he’d be supporting the coffee shop. I wonder what he’d make of the conference taking place this week? The invisible hand is still at work. For all our research, planning and forecasting … it is the customer who shapes our destinations and we ignore them at our peril.
This Blog was first published on Huffington Post