The independent sector is holding up well in the recession despite attempts to ‘talk the sector down’ in recent weeks.
One press report claimed some wholesalers’ independent customers were not paying on time, asking for longer payment times, or cancelling their direct debits.
While some retailers may well be struggling in the dire economic conditions, that is not necessarily the wider picture.
One industry source said: “In every recession since the 1970s there have been cases where retailers struggled and some closed, so it’s no surprise that there are some independents who are finding it difficult.
“One or two wholesalers, which were not strong before the recession, may be finding it an uphill struggle, but generally the independent sector is very stable.”
The latest figures from TNS Worldpanel show total grocery sales in the 12 weeks to January 25 were up by 6.4%. The independent sector could not match those figures, with unaffiliated independents ahead by just 0.4%.
But symbol groups saw sales grow by 2.3% and the big wholesalers have also reported strong growth over the Christmas period.
Dennis Evans, managing director at Spar wholesaler AF Blakemore, said: “I can’t say our independent retailers are struggling any more or less than they were last year.
“We have had none of our customers asking for extended terms or anything like that.”
John Heagney, group symbol director at Nisa-Today’s, said: “The feedback we are getting is very opposed to some of the things [being said] elsewhere.
“We have read the doom and gloom in the trade press but the general view is our retailers are happy. We had a cracking Christmas.”
He said Nisa-Today’s was attracting new retailers to its symbol group in ever-greater numbers. He expects 150 retailers to have joined by the end of the current financial year, compared with 105 in the previous year.
“It’s the very bottom end of the market that is having the trouble. The smallest retailers possibly haven’t invested in their businesses,” he said.
Every year sees a steady decline in the number of unaffiliated independents, as they either close up for good or join a symbol group. Between 2007 and 2008 about 500 stores closed, while symbol groups attracted about 600 new members.
Alan Toft, chairman of the My Shop is Your Shop campaign, said: “We have not had any reports of independents going out of business or failing to pay their bills on time.
History informs us that in every recession some businesses, which were weak when the squeeze started, will not survive. That’s what recessions do.”
Steve Fox, director of retail at Booker, said Booker Premier stores saw “double-digit” sales growth over Christmas, with Booker’s total sales ahead by 5%.
Feedback from the stores suggested people were shopping more locally.
“People are shopping to a budget. There are people [retailers] doing very well.
“We don’t underestimate the economic climate we are in by any means. That is why EuroShopper [Booker's value brand] is doing so tremendously well for our shops.”
Steve Parfett, managing director at Parfetts Cash & Carry, said: “We haven’t seen any evidence of any real change. People are careful about money, but there is a real danger of talking the sector down.
To date, we are finding the sector is reasonably resilient.”
He said there could be some problems within the delivered wholesale sector and with wholesalers with a significant food service business.
Mike Dennis
The original article appears in Independent Retail News
