Retail may be going through tough times but it remains one of the country’s greatest business success stories. George MacDonald highlights why the industry is so important to the UK
  • We're backing UK retail - are you?
    Tell us why and how you are, and join our campaign at Backing UK Retail

Retail creates jobs

Stores employ 11 per cent of the entire UK workforce – that’s almost 3 million people. Although high-profile administrations and associated job losses have been making headlines over the past few months, British Retail Consortium data shows the number of people employed in the industry has increased by 72,671 in the past five years.

Tesco alone employs 280,000 people in this country, making it the UK’s biggest private sector employer. Marks & Spencer employs 75,000 people – more than enough to fill Arsenal’s Emirates Stadium.

Despite retail posts often being unfairly characterised as “McJobs”, there is plenty of evidence to show that employment in the industry is highly valued. Asda, for instance, has more than 5,000 staff who have worked for the company for 25 years or more. Between them, they have contributed almost 12,000 years of service.

Retail also remains one of the industries in which talented beginners can rise from the shopfloor to the boardroom.

Retail generates wealth

The stores sector has made fortunes for entrepreneurs alert to the changing needs of consumers, but the billions made by individuals are dwarfed by the colossal sums deposited into the national coffers.

In 2007, UK retail sales reached£265 billion – bigger then the whole economies of some Western European countries – and the industry generates 8 per cent of this country’s gross domestic product.

Stores pay more than£4.5 billion a year just in business rates and it has been estimated that some big store groups pay as much as 50 per cent of profits in corporation and other taxes. UK retailers’ success contributes substantially and directly to society’s fabric and institutions such as the National Health Service and education system.

Retail’s profits are also widely shared. Pensioners and investors benefit by holding stores’ stock, as do many staff through participation in share schemes and similar initiatives. Last year, for instance, John Lewis’s 69,000 partners divvied up a record bonus of£181.1 million.

Retail helps regenerate rundown areas

To the 27 million shoppers a year who visit Bluewater, the megamall is simply a great shopping experience.

Few will remember the vast chalk pit that formerly scarred the landscape of a depressed district of north Kent before it was transformed by retailers and its owner into an economic dynamo, full of top-class shops.

It was the same story at Sheffield’s Meadowhall, built on the site of a closed steelworks and drawing in 400,000 visitors a week since opening on the former industrial wasteland.

And at Silverburn, the shopping centre that brought hundreds of jobs to Glasgow’s deprived Pollok area when it opened in 2007 and is now home to Scotland’s biggest M&S, Next and Tesco stores.

Retail is innovative

The nation of shopkeepers has proved itself adept not just at catering for demand, but also anticipating and creating it.

Innovation is a long-standing tradition and a line can be traced from the imaginative thinking that led Sainsbury’s to open the UK’s first self-service supermarket to the launch of pioneering digital age businesses, such as fashion e-tailer Asos.

UK retailers have relentlessly modified and updated their business models to better serve consumers and they have been at the forefront of challenging vested interests through their innovations. Remember the amazement and excitement that Carphone Warehouse created when it began offering free broadband?

Then there are financial services. It is not so long ago since they were the preserve of established banks, but many are now conveniently provided by stores.

Innovation is bread and butter to UK retailers. General merchandise goods such as clothing now feature next to tins of beans on supermarket shelves, making one-stop shopping a reality.

Pure-play e-tailing and clicks-and-bricks services such as Argos’s Check & Reserve or Comet’s Click & Collect have been deployed by retailers to improve convenience, choice and value.

Retail brings down the cost of living

Whether it is affordable champagne, top-notch food or up-to-the-minute technology, retailers have brought goods to the masses that would once have been the preserve of a privileged few.

The UK high street is widely acknowledged to be one of the world’s most competitive trading environments. In order to survive in dog-eat-dog conditions retailers have had to constantly whittle down prices while maintaining, and often enhancing, product quality.

Research by PricewaterhouseCoopers showed that over the 10-year period to 2007 the price of a typical basket of general merchandise items from Argos fell 8 per cent. The price of a basket of 21 items from fashion and homewares group Next’s catalogue was found to have remained flat pound-for-pound for 30 years. At the same time, product specification was found to have improved.

As the credit crunch bites into shoppers’ disposable income, retailers will remain keenly focused on delivering value despite facing problems such as sterling’s declining purchasing power.

UK retail is an international success story

Store groups’ overseas success is testament to the consummate commercial skills that have made them fixtures on high streets and retail parks from Prague to Shanghai, as well as Preston and Sheffield.

More than half of Tesco’s selling space is now outside the UK but the grocer is far from alone in its forays overseas. Kingfisher, M&S, New Look, Waitrose, Peacocks, Mothercare, Carpetright, Topps Tiles, Mosaic, Ted Baker and Topshop are among the many to have successfully set up shop abroad.

Retail managers from this country are in demand all over the world, from India to Australia – tribute to shopkeeping skills that are second to none.

It is easy to forget amid current dire trading conditions, but retail is one of the UK’s truly world-class industries and a success story that should be celebrated.

Retail makes the world a better place

Store groups have been corporate responsibility front-runners – as befits an industry with such close links to consumers’ and producers’ concerns.

Whether it is the promotion of fair-trade products, action to combat climate change, ensuring acceptable labour conditions at supplier companies in the developing world or supporting good causes, retailers more than do their bit.

Store groups such as John Lewis and the Co-op were built on ethical foundations. M&S has won praise and headlines for its ambitious Plan A environmental programme. Sainsbury’s has been at the forefront of encouraging healthy eating with its Five a Day promotion and similar ventures.

Charities would be worse off without the enthusiastic backing of retailers and their staff – almost all store groups have adopted good causes that they support.

There’s one poignant case in point: although Woolworths has now closed, its charity Kids First remains. Since it was established in 1999 Kids First has raised£6.9 million for 6,000 causes.

Retail makes life fun

Times may be gloomy now, but as well as providing life’s essentials retailers in the UK add to people’s enjoyment of life.

The constantly refreshed fast fashion ranges that provide an affordable treat at shops such as Topshop, the depth of range provided for enthusiasts by specialist retailers such as HMV, Waterstone’s or Halfords, and the foodie delicacies available at Waitrose, Fortnum & Mason or any mainstream supermarket are just some of the life-enhancing things on offer from UK stores.

At present, all the talk is of frugality but a bit of frivolity is always welcome – in fact even more so when economic conditions are so grim.

Retail is full of characters

Few industries could boast a cast of characters ranging from the larger-than-life Sir Philip Green to the cerebral Sir Terry Leahy, taking in the debonair Sir Stuart Rose, the speak-as-you-find Lord Kirkham, the mischievous Jacqueline Gold and just about every other shade of personality along the way.

From self-made men such as Malcolm Walker and Lord Harris, to skilled, listed-company leaders such as Justin King or Kate Swann, the retail industry is jam-packed with personality and verve.

Retail may be hard work, but any of the above would tell you it’s fun.

Retail is good for other businesses

Strong partnerships with retailers have been the basis of the success of countless companies both here and across the world. The food and drink manufacturing sector alone employs 470,000 people in the UK, generating a turnover of£74 billion a year and increasingly supermarkets are working more closely with small UK suppliers through regional sourcing initiatives to help build their businesses and obtain listings in major stores.

But the benefits of working with UK retailers aren’t just felt by UK suppliers. UK fashion retailers have played a key role in helping the economies of developing countries.

And it’s not just suppliers of goods for resale that benefit. From the supply chain to property to technology, huge industries have built up supporting the expansion and innovation of UK retailers, creating jobs and prosperity alike.

  • We're backing UK retail - are you?
    Tell us why and how you are, and join our campaign at Backing UK Retail