Who’s to blame for the decline of the high street? In reality all ‘in person’ retail businesses are finding things more difficult than before. But across the board we see the high street towns and city retail are struggling the most. But what’s the cause? Of course it’s a multifaceted issue, with more and more people turning to online shopping. But in truth, that’s not the major problem.
So who’s to blame for the decline of the high street?
In reality the largest chunk of the blame is with the government. Whilst the problem of people shopping online is real, there’s a bigger problem. What is it? It’s how retailers are being squeezed by government and how shoppers are being pushed away from the high street and town centres. So what is the problems that government is creating and how do we deal with it?
There’s a couple of major issues with the UK government and the impact on the high street, lets examine them.
Business Rates – an unnecessary evil
Business rates (sometimes called commercial rates) are a tax levied on business properties. The money collected is channelled by local authorities into services such as police, fire and waste management. Which seems ok, but when you realise the business is already paying tax, paying staff and the tax on their wages, paying tax on all the goods and services utilised in the running of the business you soon see it’s not only unnecessary but actually quite evil.
Businesses need to pay for waste collection etc, but should they also pay huge Business Rates in addition to rent? For which the landlord is already paying tax on? The cost can often incredibly high and equate to the wages of 2-8 staff in small to medium sized sites. Now let’s look at that impact.
If a business employs people, taxes are paid on that employees salary, but more importantly that person is employed. It brings benefit to them and to the community, where they spend their money. The tax revenues still come into the system, but we create and protect jobs.
We also take some of the pressure of businesses that are already feeling it. Sadly this is a glaring example of the short sightedness of government. They’d rather take the fast money today, than keep a local economy going for longer.
Parking Restrictions & Costs – Fools Gold
The idiocy of high priced parking and overly limiting restrictions is astounding. Of course, it gives our shortsighted government and easy stealth tax, but that’s not all it is. Overly limiting Parking restriction or high charges drive (great pun) shoppers elsewhere. Whether it’s it the out of town retail parks or simply to buy online, they are not coming into town.
But what is a town without people? Without a community the lifeblood of the town is drained. How can parking charges and fines be more important than a thriving town. There’ll be an argument for public transport but we all know that’s not why the restrictions exist.
An element of control prevents issues of course, but a 2-3hr FREE parking allowance would revolutionise the volume of visitors. Imagine if you will if popping to your high street was accommodated. If when you visited it was busy and vibrant. How would that feel? How would the shops and the community benefit?
Economy – A House of Cards
Zoom out, look at the big picture. The UK, like other major economies endless print money and devalue the currency means peoples money doesn’t go as far. In small scales, remember what a chocolate bar cost 10 years ago vs now. Now extrapolate that across everything in our society and peoples budgets are tight. The Governments solution is to tell businesses to increase wages. Of course to everyone that seems right, but the only reason people need more money, is the devalued currency. So while the government create the problems with the financial system, they point the finger at businesses, demanding higher pay.
What could go wrong? With high business rates, parking charges limiting footfall, increased business costs and higher waves, what is the result?
It doesn’t take a genius to see businesses have to cut staff or cut hours. If they don’t they’ll be forced to close. They can’t simply increase costs, as people aren’t visiting already and costs are cheaper online. So what is the solution to keep the business going? Automate where possible, cut the costs of staff. But what’s the impact of that? Less employment within the local community. If people aren’t employed in the local community, there’s less local people with money to spend. And so continues the cycle.
The Solution
It’s fair to say the government is largely to blame for the decline of the high street. Some elements are hard to resolve of course, but others are much easier. We as the public need to put pressure in the government. both local and national to make radical change. It’s not about businesses making more money, it’s about protecting communities. It’s about retaining jobs, increasing footfall and rebuilding our local economies.
Companies like Amazon are taking a huge chunk of the business our local areas would traditionally have provided. Whilst our local businesses are being hit with endless taxes and costs, Amazon isn’t. Amazon gets away without paying taxes in the UK. Why does the government allow the tax revenues of products sold in the UK to not be paid by these giants? Whilst they are based off shore, the tax office could require taxes to be paid on business done in the UK. Why don’t they? It seems like a huge amount of tax revenue that should be in the country, that’s being missed. Tax revenue that could quite easily be retained.
The realistic solutions seem to be:
- Cut Business Rates
- Cut Parking Restrictions
- Appropriately tax big business
These challenges are big enough. How can we tackle them? Or more importantly, what is the cost of not tackling them?
What can we do in the meantime?
If you’re looking for ways to increase visitors to try and support the local economy, there are options! Creature Events offer a range of activations that really boost the local economy. See Creature Events HERE!
Want something more techy? Have you seen the Ultra Reality VR / AR and Holo solutions?
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