Tuesday, 25 March 2014

Archaic BRC Needs Charlie Mayfield To Guide It Into The 21st Century

The British Retail Consortium, the archaic, 'big box'-focused retail industry body for the UK, has long been criticised for siding with the big boys.

That came to a head last month when Labour MP Simon Danczuk attacked the organisation for 'ham-fisted' lobbying and for being 'skewed' towards big supermarkets following a meeting between the BRC and MPs.

But the problem is much deeper than that. Recent attempts by the organisation to set the agenda are doomed to failure because it is now trying to stem the tide of two unstoppable forces.

The tide has turned against out-of-town grocery giants and their non-food counterparts that operate from 'big box' sites - the industry term for the big warehouse stores found in retail parks and out of town shopping centres. People want to see more local shops and investment in town centres - something powerful forces in the sector have sought to kick into the past over the last 20 years.

But, just as importantly, even in a digital world there is a growing recognition that small businesses need vibrant town centres in both the the online or offline world.

But recent moves by the BRC and proposals to overhaul the rates system have sought to ignore both these things.

Three of the four recommendations by the BRC to reform the business rates system would undoubtedly sought to prop up the old, big box, out-of-town retail model over new visions of the future.

The review was led by Sainsbury's chief financial officer John Rogers - a very talented executive but one that helps to run one of the few businesses whose online sales are still only 5 per cent or less of its business. Meanwhile, Sir Ian Cheshire, current chairman of the BRC, is the chief executive of B&Q-owner Kingfisher - probably one of the few other retailers in the country whose online sales can be counted on the fingers of one hand.

Hardly a representative sample of the future of British shopping and retail.

So with the arrival of John Lewis chairman as a replacement for Sir Ian Cheshire, will the BRC experience any kind of epiphany?

John Lewis and sister firm Waitrose are large, traditional retailers in many ways but they are not so tied into the out-of-town movement as the likes of B&Q, Sainsbury's, Tesco, Currys and Asda that hold such sway at the organisation. Many Waitrose and John Lewis stores are within town centres or on the edge of towns.

But more importantly, both John Lewis Partnership businesses were early adopters of the online movement and, the department store chain in particular, exemplars of how bricks and mortar can be married with the online world.

At the very least that perspective should help inform the BRC and could help the cause of online retailers in what is one of the most powerful lobby groups in the UK.

With business rates and tax high on the agenda it will become clear soon enough whether Mayfield has the inclination or the stomach to guide the BRC in the right direction.

Helping to prop up old, antiquated models of retailing is undoubtedly on the minds of many of its members as they struggle to reshape themselves for the future. But the bottom line is that Britain needs lobby groups such as the BRC to talk sense and to help shape the economy for the benefit of all as much as to defend and argue the needs of its members.

If it fails to do that it could either find itself causing irreparable damage to a vibrant retail economy - or more likely being identified as out-of-touch and getting left behind in the conversation over a reshaping of the tax system.

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