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Tony Dyer: You think we have too many supermarkets in Bristol? Think again…

Figures from a report by retail research company CACI suggests major supermarket chains will target the Bristol area for another one million square feet of retail floorspace.

Sainsbury's

Sainsbury's proposed store at Ashton Gate

Figures from a report by retail research company CACI suggests major supermarket chains will target the Bristol area for another one million square feet of retail floorspace. The estimates are based on research which shows that there is currently 1.9 sq ft of supermarket floorspace for every resident.

However, this is well below the 2.9 sq ft per person in some areas of the country and the major supermarkets insist there is still room for growth in the Bristol area despite increasing public opposition to the major supermarkets. Although London has the lowest densities of supermarket floorspace in the country, it is thought that lack of suitable sites and higher development costs may force retailers to concentrate on other regions.

Based on Tesco’s average store size, one million square feet equates to 75 new stores. More disconcerting for those worried about the growth of the major supermarket chains is that the figures are only for stores above 3,000 square foot – excluding almost all Tesco Express stores (which account for nearly half of Tesco’s stores).

CACI’s analysis has “implications for the future store development of all the major supermarket chains” particularly“as they look to focus on town centre locations and smaller store formats to best fulfil their expansion plans”.

Out-of-town sites in areas with high demand are limited and often involve sugar-coating a major new store with promises to include additional facilities – in Bristol the obvious example is Sainsbury’s funding of new football stadia. However, as with the Stokes Croft Tesco, smaller stores often merely require an application for change of use, and not even that if the site was already retail, for example the Whiteladies Road Sainsburys.

Current planning law restricts the ability of planning authorities to oppose such developments, despite recognition of the impact of declining numbers of independent shops on the local economy. Instead planning committees are reduced to scrutinising signage and air conditioning conscious of the implied threat of the planning inspectors.

It is no surprise therefore that Morrisons announced that it too would be trialling a convenience store format further adding to the pressure.

BBC research shows the Bristol area saw an increase in Big Four supermarkets from 19 in 2004 to 76 in 2010. There are concerns that as the major supermarket chains expand their presence, the pressure on independent food retailers in the city will increase, leading to store closures, job losses, and reducing customer choice.

Research by Joy Carey for the “Who Feeds Bristol?” report (published in March 2011) found that:

  • Ten of Bristol’s council wards have no independent grocers including four of the seven most deprived. All of these wards have large supermarkets or are close to wards with supermarkets. Additionally nine of these wards have ten or less food retailer;
  • Hengrove and Whitchurch Park wards have no independent butcher, fishmonger, baker, or greengrocer – but each has a large superstore;
  • Apart from the five wards with no supermarket at all, the seven least deprived wards have the lowest density of supermarkets but each have over 10 independent food retailers (except Stoke Bishop which has the highest level of car ownership in the city).

Information from the DCLG also casts doubt on whether supermarkets have a positive impact on their local areas – the Hareclive neighbourhood in Whitchurch Park ward was identified as the sixth most deprived neighbourhood in Bristol when a new supermarket was opened there four years ago with accompanying promises of job creation and regeneration. DCLG data shows that the neighbourhood is now the most deprived neighbourhood in the whole of Bristol.

Promises of job creation are a constant theme of proposals for new supermarkets but delivery is often lacking. The StopSainsburys group discovered that Sainsburys promised to create 250 jobs when it previously expanded its Winterstoke Road store, but instead reduced employment by almost 150.

At a national level, the Association of Convenience Stores found that Sainsburys and Tesco between them increased their floorspace by 2,750,000 square feet in a year – but reduced their staff levels at the same time by hundreds.

The figures above, of course, fail to take into account the loss of jobs as independent retailers are forced out of business by competing supermarkets. On average independents employ twice as many staff for an equivalent level of turnover compared to the major supermarkets. Expenditure of £100,000 pa at an independent retailer secures the jobs of two members of staff. If this expenditure is switched to one of the major supermarkets it will support one member of staff.

The potential effect on local jobs does not end with those directly employed by the retailer. Most independents tend to use local suppliers and maintenance companies. In contrast, the major supermarkets centralise their supply and maintenance contracts. As a result for every £1 spent in a Big Four supermarket, 80% is taken out of the local economy. For independents, the reverse is true with 80% of expenditure being recirculated back into the local economy supporting jobs elsewhere within the local economy.

One example of such a supply organisation that is under threat from the expansion of the major supermarkets is the Bristol Wholesale Fruit Market in St Philips. Joy Carey highlights that the market “serves virtually the entire independent greengrocery sector across South Wales and the

Southwest of England”. However, a key 20% of its trade comes from the Bristol region, and as the independent sector in Bristol comes under increasing pressure, losses in this core market are particularly significant.

“If the St Philips wholesale market were to collapse, this would cause significant loss

of local jobs and would cause a domino effect for thousands of producers throughout the South West and further afield, and for hundreds of caterers and independent retailers.”

Joy Carey, “Who Feeds Bristol?”

Despite the inexorable rise of the Big Four supermarkets they still remain in the minority. Within the Bristol City boundary, there are 33 supermarkets operated by the Big Four with another 37 operated by other major retailers such as the Co-operative/Somerfield, Iceland and Lidl.

‘Who Feeds Bristol?’ analysis of food retail data from the Public Food register indicates that there are some 400 independent food retail outlets of various types, all offering an unique service to their local community. 180 of these are specialist food retail outlets – bakers, butchers, fishmongers, greengrocers with trained staff. To this can be added the local supply and maintenance network including facilities like the Wholesale Fruit Market.

An extra million square foot of major supermarket floorspace may well signal the end of Bristol’s independent retail stores as a viable business sector – with job losses that the supermarkets are simply unable to replace.

REFERENCES

CACI: http://www.caci.co.uk/530.aspx

BBC – Growth of the Big Four supermarkets http://www.bbc.co.uk/news/uk-12007835

“Who Feeds Bristol? Towards a Resilient Food Plan” http://tinyurl.com/6yps853

DCLG (Dept of Communities and Local Government) – http://www.communities.gov.uk/publications/corporate/statistics/indices2010

StopSainsburys – http://www.stopsainsburys.co.uk/seven-myths/myth-1-jobs/

Association of Convenience Stores – http://tinyurl.com/6ghc48v

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