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Economic slowdown
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Bonnie Blue

Posts: 131
Joined: Jan 2009
Post: #1
09-01-2009 08:03 AM

In the dim recesses of my mind I recall a time when books all had to be sold at the same price
This is no longer the case

Amazon are a vast organisation and have tremendous buying power
With that goes discounts that mean a small shop will buy in at the price Amazon sell out

I bought a cook book at Christmas
It was ?30 in Waterstones and ?19.50 on Amazon

A few years ago I used to buy books for a children's hospital for their renal unit
I would do my homework in Ottakars (now Waterstones) and then buy on Amazon
Clean new books, carriage paid, limited germs, well packed and insured
A small shop cannot compete on that level they just can't

I don't know how much the rents are in HOP but this quiet little area has to turn over a lot of money per day to pay the rent, insurances, buy stock, pay self/staff and hopefully make a profit as well

The public understandably don't see beyond their immediate needs
When I used to do beauty therapy the client saw, for example, an underarm wax as a 5 minute job and couldn't understand the pricing but it cost almost as much in materials and insurances etc as it does to wax a full body!! You have to use more wax but a wax strip goes a long way The insurance is the same whether you remove one hair or 1,000,000. the health and safety costs are the same
It also costs money to stand in an empty shop with no customers. the rent heating lighting insurances have to paid whether a customer walks through the door or not
A bit like children's clothes, much smaller but actually more fiddlyto make and when a factory costs something they have to time each element of the procedure.
You also have the problem of buying the right products in and in the right quantities which is not easy

Customer loyalty is a hard one
It doesn't matter how much they like you
I used to sell a lot of nutritional products and spent a lot of time advising clients and holding the stock.
I don't do it any more - how ever much the product worked for them, if Holland and Barratt was more convenient they would pop in and replenish there. It is the way life is and small businesses struggle

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Posts: 64
Joined: Feb 2008
Post: #2
09-01-2009 10:59 AM

Some small businesses struggle, and some don't. Economies of scale give a lower unit price and probably some greater freedom of movement for development, but big companies go under too - eg MFI, Woolies and so on.

Classical economics argues that the price mechanism is the determining factor, but clearly other things are at play. Exclusivity, or a 'nice' shopping experience might offer 'added value'

Nevertheless, the sum of the product has to have a large enough market to sustain the outlet - indeed, c'est la vie.

The ?1,000,000 question is, though, what kind and what format of business will now survive in Honor Oak Park? What is the strength of potential market in HOP? If shopping is reducing to simply acquisition of stuff, then ordering by internet and home delivery is the thing and shops, as we know them, will go. However, hairdressers, and I guess beauty therapy, will still require people to do a hands-on job. The same with cafes and bars. Services still require people, so these might be the kinds of shops for the future. Books, and toiletries, are probably most easily bought via the internet - I know I do.

The other exceptions are places like Green and Blue in East Dulwich, which combines a thoughtful and different wine merchant with a small deli and bar. Three businesses each in symbiosis with the other. The wine merchant aspect also has a website for ordering and delivery. Perhaps it is having this multi-line, multi-media approach which is the way forward?

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Bonnie Blue

Posts: 131
Joined: Jan 2009
Post: #3
09-01-2009 11:15 AM

I don't know why MFI went down except that mortgages have breen much harder to raise for the last year so people have not been buying kitchen etc
Woolies has been on a downward spiral for a long time and had no real place any more. They used to have enormous buying power because I remember them from when I was in the Toy business 20/30 years ago. They were pretty well equal to Great Universal Stores the mail order compnay.
I also suspect that, going back to books, Amazon may be allowed to buy a small quantity of the book I bought because they spent a fortune on Nigella Lawson's new book where as the small shop wouldn't have the capital or the space for much stock or either and would be most concerned about the one they knew would sell quickly

With beauty therapy I know that most people are concerned with hair removal in all its forms but the more luxurious treaments are just that and are rarely sustained
***bit like dieting*** We get through January and then give up because these things are expensive and non essential in the general scheme of things
The one thing that drove me mad was the manicure and pedicure
They take ages to do really well because people don't take care of their hands and feet , the cost to the retailer is really high because one needs such a huge range of colours and preparations but the return is really low becuaswe of what it is

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Bonnie Blue

Posts: 131
Joined: Jan 2009
Post: #4
09-01-2009 11:17 AM

I notice in the smaller towns in the North of England the most prominent outlet on the High street is the Charity shop

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Posts: 46
Joined: Nov 2007
Post: #5
09-01-2009 03:04 PM

Hmmm where is this information from? I am from a small town/village in the north east and can assure you it is thriving with a quality butchers, 2 greengrocers, 2 bakers, a chemist and a pet clothing and accessories shop (not sure about that one). this is even despite there being the biggest Tesco I have ever seen (2 floors!) only a mile away.

I dont have any hard evidence for why these businesses continue to survive, but I would like to think in the small towns and villages in the north there is a stronger sense of community and loyalty to local businesses.

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Bonnie Blue

Posts: 131
Joined: Jan 2009
Post: #6
09-01-2009 04:14 PM

Sounds as though you are just outside HarrogateLaugh

The Town I am talking about is south of York and there must be a good half dozen charity shops in the same high street
They do have a thriving butchers in a small village ousde which saw a queue stretching round the village green on christmas eve at 7am but a normal day for them is busy
but the town itself has/had woolworths and two big supermarkets but the rest is pretty sad

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Bonnie Blue

Posts: 131
Joined: Jan 2009
Post: #7
09-01-2009 07:43 PM

i don't recall starting this thread eitherUnsure

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