This is an important and MUST READ article from the Telegraph. Check it out!
In many respects retailing is an anachronism in need of major transformation.
Once again, it highlights that David Cameron’s government has no industry strategy and is reliant on financial services and austerity to stimulate the economy, along with Government guarantees for home loans.
Small businesses have been crippled by bureaucracy from the EU and hostile local authorities with aggressive rating strategies. Of course, the late Margaret Thatcher would have been able to empathize with the retailing challenge because of her corner shop background; this is in sharp contrast, with the privileged backgrounds of David Cameron, George Osborne and friends at the Conservative Party Central Office who seem to favor gays and minorities.
Since 2008, the banks have been excessively hard on lending to small businesses, and now with government guarantees backing home loan mortgages, banks are again neglecting the finance of small businesses. The banks are typically managed by vast bureaucracies, with relatively few who understand the retail sector anyway. In the past, local bank managers knew their local retail customers well and could vouch for their bona fides. These days it’s all about business plans.
Many large retailers have lost their way because of indifferent customer service, employing vast armies of poorly educated assistants who are pre-occupied with their iPhones and don’t like being distracted by customers. In supermarkets stacking shelves in prime time seems to get preference over helping customers locate goods.
Enormous opportunities for retailing have been missed by the UK Government. The armies of wealthy Chinese tourists prefer the US or the Eurozone because visas restrictions are more onerous entering the UK; also customer service in the UK seems to have been subordinated. London has some of the most famous shops in the World, like Harrods and Selfridges but wealthy Chinese seem to prefer London, Rome, New York and Los Angeles; does the UK Government know why? Do you remember when shop assistants were experts in the products that they were selling and could communicate with their customers? What about Government policy to encourage language training, especially Mandarin? To put it in perspective, when I was in Beijing, China, last year, Chinese shop-assistants were able to sell impressively in both English and Russian.
Retailing is in many respects a dead-duck industry, like the many sections of UK manufacturing; the internet has
radically changed the customer interface and reduced transaction costs enormously.
Of course, the austerity policies of George Osborne have not helped. If the Government cut VAT, retailing would get an enormous stimulus.
Ultimately, the failure of retailing is down to Government policy of David Cameron’s government, in my view.
Do you remember when the Conservative Party used to be regarded as the pro-business party? Quaint?