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The Store Through Time A microcosm of UK retail restructuring and retail planning? Michelle Lowe*, Steve Wood* and Neil Wrigley** * School of Management,

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Presentation on theme: "The Store Through Time A microcosm of UK retail restructuring and retail planning? Michelle Lowe*, Steve Wood* and Neil Wrigley** * School of Management,"— Presentation transcript:

1 The Store Through Time A microcosm of UK retail restructuring and retail planning? Michelle Lowe*, Steve Wood* and Neil Wrigley** * School of Management, University of Surrey ** School of Geography, University of Southampton

2 Our focus today… To argue that this store is a microcosm of structural change across the UK food industry To provide case study evidence of how retailers are becoming strategic in managing the development process Our focus today will be on the second of these aims

3 Presentation outline A new retail format – Carrefour enters the UK in 1974 A focus on recent strategic management of the store development process Recent adaptive retail strategy Planning regulatory tightening Asda Wal-Mart background Strategic behaviour at Chandlers Ford hypermarket Conclusions

4 A new retail format – Carrefour enters the UK July 1974 – Chandlers Ford, Hampshire Carrefour open a 50,000 sq ft store emblematic of a new era of modern retail development of which there was little experience in Britain. A hypermarket based on the French model (Department of the Environment, 1976, 2)

5 A new retail format – Carrefour enters the UK A gross ground floor area of 102,000sq ft –50,000sq ft was sales area. –A mezzanine floor of 21,000 sq ft which housed a self- service restaurant for the public, staff canteen, offices and more storage space. Unusually for its time, sold a wide range of non food goods in addition to its food offer, including clothes, DIY and garden supplies, and electrical goods. Incorporated a drive thru petrol filling station and a tyre bay where customers [could] buy tyres and have them put on while they shop (Department of the Environment, 1976, 2).

6 A new retail format – Carrefour enters the UK Subsequent changes in ownership –1989 – Gateway takeover –1991 – Asda –1999 – Wal-Mart acquires Asda

7 Recent adaptive retail strategy Retailers are flexible – they had understood the recent changes in government policy and had to some extent adjusted their development strategies (Guy and Bennison, 2006, p 960) Retailers attempt to influence the rule-making (Pal et al., 2001) Retailers challenge established rules (Wood et al., 2006)

8 Retail planning tightening Since 1996: Planning Policy Guidance Notes (PPG6) –Introduce the needs test –Sequential test –Protection of town centres Planning Policy Statement 6 (PPS 6) in 2005 reaffirms core values Barker Review 2006 – makes the case for elimination of the needs test White Paper of May 2007 suggest potential for easing of red tape (and will replace needs and impact tests).

9 Asda – Strategic Market Behaviour 1)Round 1: Challenge the rules Successful performance requires identification of the opportunities and constraints imposed by the regulation authorities, prediction of how these constraints might shift over time, and identification of opportunities for influencing the way in which these things occur (Cronshaw and Thompson, 1991, p 91)

10 Sept 2002 Application to Council for a Certificate of Lawfulness to construct a mezzanine floor of 50,000 sq ft (already a sales area of 83,305 sq ft) Eastleigh Borough Council refused permission in May 2003 on the basis: –[the mezzanine] constitutes development for which planning permission is required. (HM Planning Inspectorate, 2004, p 1) Asda – Strategic Market Behaviour

11 Asda Wal-Mart appealed to the High Court at the start of 2004 and won. This case (and others) catalysed a rush to mezzanine construction across the food and non food retail market …and a round of (re)regulation –The retailers vulgar boasting catalysed interest in legislative intervention (Gummer, 2004, p 57). – significance of uncontrolled mezzanine installation, particularly in out-of-centre locations…potentially undermines the Governments key objective for town centres (ODPM, 2005, p 6) Asda – Strategic Market Behaviour

12 Round 2: The on site replacement proposal June 2005: Proposed demolition of the existing store and the redevelopment of the site to build a new two storey store of 214,000 sq ft (gross) including a decked and surface level car parking (1011 spaces). Asda – Strategic Market Behaviour

13 …[mezzanine] appeal on 20 February 2004 confirmed that there is no restriction on the level of sales floorspace permitted at the store. The additional 14% could, therefore be accommodated at the store at present without the need for planning consent…This is a material consideration in assessing the merits of this proposal. (Asda Wal-Mart, 2005, p 23, my emphasis) Asda – Strategic Market Behaviour

14 September 2006 – Eastleigh Council refuse permission Late Asda extend their mezzanine and add a travellator. April 2007 – Asda Wal-Mart appeal against Eastleighs decision. The story continues…. Asda – Strategic Market Behaviour

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16 Conclusion A store as a case study of retail change The retailer is an active agent in redefining the planning rules Context specific nature of strategy - strategy in action: –Retail innovation is not wholly seen as being the product of deliberate design. Winning formats emerge from an opportunistic and incremental process (Reynolds et al., 2007, p 658). –Incremental evolution makes it hard – and from a retailers point of view, often undesirable – to set a format in stone (Reynolds et al., 2007, p 658).


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