Sayonara! Pound stores head out of town

In Austerity Britain, bargain stores are a growth industry. And they are coming to a retail park near you...

by Michael Northcott
Last Updated: 19 Aug 2013

In these austere times lots of retailers are feeling the squeeze, but according to a new report, the cheep-and-cheerful brigade are spearheading the out-of-town expansion drive, taking the vast majority of new space in retail parks over the last 12 months. Trevor Wood Associates’ ‘Definitive Guide to Retail & Leisure Parks 2012’ found that Home Bargains, B & M, The Range, and Poundworld took over 1m sq ft of space out of town between them during 2011. 

Landlords will be pleased that they’re snapping up all this space: they have seen vacancy rates on parks with open A1 planning permission (which can be occupied by any type of retailer) dropped from 7.9% in 2010 to 6.8% in 2011. Not bad in such hard times.

It’s not all good news though, as out-of-town space that can only be occupied by retailers stocking bulky goods (who knew there was even a rule about that?) has seen vacancy rates climb slightly, from 10% in 2010 to 10.8% in 2011. Furthermore, downsizing and closure of some retailers actually increased the amount of second-hand floor space available in ‘administration season’ mid-2011.

When the likes of Jane Norman, Habitat, TJ Hughes and Focus DIY found themselves in the doldrums in May and June 2011, there was certainly a sense that the high street retail sector was in trouble. 

But with tighter purse strings and dodgy job security, the general public are as hungry for a bargain as they’ve ever been. For value retailers, that’s great news, and many of them have extensive expansion plans in full swing. What this out-of-town move will mean for local high streets up and down the country is hard to call…

Find this article useful?

Get more great articles like this in your inbox every lunchtime

Subscribe

Get your essential reading delivered. Subscribe to Management Today