Out-of-town shopping malls suffer as fuel price deters shoppers

[Paul Mobbs]

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This recession just gets greener and greener!

Perhaps all the eco-campaign groups should have argued for runaway fuel and 
commodity prices rather than promoting 'green consumerism'? ;-)

P.


http://www.guardian.co.uk/business/2011/apr/08/town-shopping-malls-fuel-price

Out-of-town shopping malls suffer as fuel price deters shoppers

John Lewis reveals sales plunge in stores at Bluewater and Cribbs Causeway, in 
contrast to traditional shops

Tom Bawden and  Dan Milmo, Guardian On-line, Friday 8 April 2011


Soaring petrol prices are hitting sales at out-of-town shopping centres as 
cash-strapped consumers think twice about making long journeys to retail 
destinations such as Cribbs Causeway in Bristol and the Metrocentre in 
Gateshead.

As the price of oil breached $124 a barrel for the first time in two and a half 
years – and is now at a record in sterling terms, as a result of the weaker 
pound – John Lewis revealed big sales declines at its shops in key out-of-town 
malls, including Bluewater in Kent and Cribbs Causeway.

Takings at the retailer's Bluewater department store are down more than 9% 
since the end of January, with the decline accelerating to more than 12% in 
the most recent week. At the John Lewis store in Cribbs Causeway mall sales 
have tumbled more than 11% so far this year and were down more than 14% last 
week.

City retail analyst Freddie George, at brokers Seymour Pierce, said: "With the 
petrol price so high, we knew this was coming and these John Lewis figures 
provide the first significant evidence."

The dismal sales at John Lewis's out-of-town centres are in sharp contrast to 
its more traditional city centre branches and internet site.

Retail research group Synovate, which monitors the number of shoppers visiting 
retail centres nationwide, said it had also detected a move for shoppers to 
stay local. The number of shoppers going through the doors of out-of-town 
centres fell nearly 12% in March, compared with last year, and compared with a 
7% decline across all shops.

With the price of oil predicted to hit $130 later this year, the cost of 
petrol is likely to climb even higher. Over the past year it has leaped by 
some 21p to its current level of around 134p a litre. Analysts say further 
increases will accelerate the move away from out-of-town centres as shoppers 
baulk at rising petrol costs.

Tim Denison, director of retail intelligence at Synovate Retail Performance, 
said: "If petrol prices remain high, there is likely to be some kind of 
structural shift, with people going to out-of-town centres less frequently and 
spending more time there when they do. We would expect more promotion from the 
out-of-town centres, possibly by providing free bus services to customers, 
rather than expecting them to come in under their own steam."

The average shopper turning up at a regional mall like Meadowhall or Bluewater 
has driven around 32 miles, according to CACI, another retail research group. 
A shopper who decides to stay local instead will therefore save about £12 in 
petrol costs for the round trip. Jonathan De Mello, of property agents CB 
Richard Ellis, said history showed small out-of-town centres tend to suffer 
from rising petrol prices but that the larger ones actually benefit as shoppers 
ensure they visit a site "where everything is under one roof". John Lewis 
played down the impact of rising petrol prices, arguing that the weather and 
timing of bank holidays were more significant. Nat Wakely, director of selling 
operations at John Lewis, said the equivalent period for last year included 
Good Friday, a day when city centre workers tend to avoid high street outlets 
in favour of a day out at an out-of-town mall.

Motorists are cutting back on journeys in order to save money, according to an 
AA poll in January. Edmund King, the AA president, said short car journeys are 
less fuel-efficient because they involve stop-start driving and trips to 
shopping centres could fall victim to a domestic cost squeeze. "If the journey 
to the out-of-town shopping centre is on average five or six miles that is a 
particularly inefficient journey in terms of fuel use. So if people can avoid 
that, they will."

Although John Lewis's more central stores tended to perform better than its 
out-of-town sites, the latest data from the group showed times remain tough on 
the high street.

Reporting at the end of a week that saw Halfords and Carpetright becoming the 
latest retailers to issue profits warnings, John Lewis revealed that it too was 
suffering from British consumers' dwindling confidence and purchasing power. The 
John Lewis department stores recorded year-on-year sales growth of just 1.1%, 
including the benefit of the January VAT rise, well down on the near-10% 
increase seen in the previous six months.



- -- 

.

"We are not for names, nor men, nor titles of Government,
nor are we for this party nor against the other but we are
for justice and mercy and truth and peace and true freedom,
that these may be exalted in our nation, and that goodness,
righteousness, meekness, temperance, peace and unity with
God, and with one another, that these things may abound."
(Edward Burrough, 1659 - from 'Quaker Faith and Practice')

Paul's book, "Energy Beyond Oil", is out now!
For details see http://www.fraw.org.uk/mei/ebo/

Read my 'essay' weblog, "Ecolonomics", at:
http://www.fraw.org.uk/mei/ecolonomics/

Paul Mobbs, Mobbs' Environmental Investigations
3 Grosvenor Road, Banbury OX16 5HN, England
tel./fax (+44/0)1295 261864
email - mobbsey at gn.apc.org
website - http://www.fraw.org.uk/mei/index.shtml
public key - http://www.fraw.org.uk/mei/mobbsey-2011.asc

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