Food outlets snap up empty shops

The introduction of town centre coffee shops began in 1978, when Costa Coffee opened on Vauxhall Bridge Road. From then on, the industry has grown exponentially to become a ubiquitous presence on the UK’s high streets

The are currently over 5,000 branded coffee shops in the UK, serving £2bn of coffee in 2012. This is indicative of the increasing demand from the UK consumer for coffee, with this figure doubling the sales achieved in pre-recessionary 2005. Taking the 5,500 independent operators and a further 5,000 that have opened in outlets such as corner shops and pubs, there are around 15,000 coffee shops in the UK.

In terms of occupational take-up, the predictions are encouraging for coffee shops. It is estimated that a further 7,000 branded coffee shops will open in the next few years, in addition to 18,000 independent and non-specialist shops.

With a focus on high streets, if the independent operators were to be discounted, it is reasonable to assume that a high proportion of the 7,000 new branded coffee shops will take occupation on high streets.

Allegra Strategies, who specialise in strategic research consultancy focusing on food, retail and hospitality, produced a report in 2010 that considered the importance of coffee shops to the vitality of UK high streets.

Of the businesses interviewed for the report, 89% of businesses agreed that coffee shops improve the vibrancy and atmosphere of the high street, whilst 60% acknowledged that coffee shops attract shoppers.

Allegra also estimate that coffee shops can boost a local economy from 3-5% through increased footfall, higher visit frequency and prolonged dwelling time.

Convenience and food stores are also playing an increasingly prominent role in the revitalisation of the high streets. Similarly to coffee shops, whilst there is little data available that explicitly considers the take-up of vacant units, the indirect consequences of food outlets’ continued expansion would suggest that take-up of vacant units is high.

There is a growing trend for major supermarket operators to locate smaller branches on high streets. It is felt that consumers, in light of the recession, are keen to buy fresh food and it is more convenient to do so on their walk home from work for instance, than going to a drive-to location. Consequently, the major food outlets are leveraging themselves on the UK’s high streets at a rapidly increasing level.

Morrisons for instance began the year with 12 Morrison Locals, but by the end of the year it will have 100 and by 2015, probably 300. Ironically, supermarkets are being labelled as potential saviours of the high street, particularly when they take occupation of vacant premises. Morrisons, for example, has bought almost 100 stores from the administrators of Blockbuster, HMV and Jessops, which could provide a real boost to local high streets.

There are currently 50,000 local supermarket outlets and this only looks set to increase, with vacant retail units an obvious target for new premises.

David Bell is head of leisure at Savills

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